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The Japanese yen’s renewed weakness is testing the patience of policymakers in Tokyo and unnerving investors.The currency fell to 154.79 against the dollar on November 12, its lowest level in around nine months, following recent declines largely prompted by the emergence of Sanae Takaichi as Japan’s new leader. Takaichi’s focus on boosting economic growth has fuelled expectations she will be reluctant to prod the Bank of Japan to raise interest rates — a move that would support the yen.If the central bank waits longer to increase borrowing costs, the government may be forced to wade into currency markets to prop up the yen. Officials have indicated they are keeping a close eye on currency market movements, a typical first step before direct intervention.While Japan is committed to international pacts that stipulate markets should determine exchange rates, the Group of 20 has acknowledged that excessive or disorderly currency moves can threaten economic and financial stability, giving members wiggle room to intervene when volatility spikes. Japanese officials insist it is sharp or disorderly movements — not any specific exchange-rate threshold — that trigger intervention.The question now is how far — or how quickly — the yen needs to fall before Tokyo steps in to protect it.Why is the yen’s weakness cause for concern?While the yen’s slide over the past decade or so has transformed Japan into an affordable travel destination for millions of foreign tourists and boosted the profits of the nation’s biggest exporters, its weakness has become acute.For an economy heavily dependent on imported energy and raw materials, the feeble yen drives up costs, fuelling inflation for households and squeezing margins for domestically focused businesses. The resulting cost-of-living crunch has already helped bring down two prime ministers.There’s another reason why Japan’s government may want to act. President Donald Trump has repeatedly criticised Japan for its weak currency, arguing it gives Japanese manufacturers an unfair trade advantage. That’s a point that came up in trade negotiations between the two nations.What is currency intervention?When a country’s central bank steps into the foreign exchange market with the intention of strengthening or weakening its currency, that’s known as direct intervention.In Japan’s case, the Finance Ministry decides when to act and the BOJ carries out the operation via a limited number of commercial banks. Japan will either buy yen or sell dollars to strengthen the local currency or sell yen and buy dollars to weaken it. The scale of the transactions depends on how much impact the ministry seeks and how quickly the market reacts.Where does the money come from?When Japan intervenes to prop up the yen, the dollars typically come from its foreign reserves in the form of cash or US Treasury holdings. As of the end of October, Japan had $1.15tn in foreign currency. During last year’s interventions, for example, Japan appeared to sell some US Treasuries from its reserves to help finance the action.How effective is currency intervention?Intervention is a clear way for the government to tell speculators it won’t allow its currency to go into free fall or rocket up. However, it only offers a temporary fix unless economic fundamentals driving the trend are also addressed. In addition, foreign reserves are generally there to protect the economy in the event of a major financial shock or unexpected event, not to artificially prop up the currency. A unilateral move is still seen as unlikely to turn the tide of currency momentum, but it can buy time until market dynamics change.How often does Japan intervene in its currency market?Japan has exchanged vast amounts of money over the years — usually to weaken the yen. But recent intervention has been in the opposite direction. The government spent a total of almost $100bn on yen-buying to prop up the currency in 2024. On each of the four occasions the exchange rate was around 160 yen per dollar, setting that level as a rough marker for where action might take place again.To keep traders guessing, officials often don’t immediately confirm an intervention. But the ministry discloses the amount spent on intervention at the end of each month. Generating doubt and fear of losses in the market is part of the ministry’s strategy, making the comments of officials highly potent.What is verbal intervention?To keep traders on guard and slow movements in markets, senior officials can make remarks that hint at the prospect of intervention and bloody noses for market players. Comments by the finance minister or the ministry’s top currency official can quickly scare speculators. Officials typically use a carefully calibrated set of expressions to ratchet up their warnings and show how close they are to moving. References to “taking action” suggest intervention is close.What are the flow-on effects of monetary intervention?When Japan’s authorities intervene in currency markets, the immediate impact is typically sharp. Past episodes show the yen jumping around 2 yen against the dollar within seconds and 4 to 5 yen within hours.These abrupt swings can cause huge losses for traders making speculative bets that the currency will keep moving in the previous direction. Sharp moves can also cause headaches for businesses trying to price goods, make payments and hedge against exchange rate fluctuations.For the government, intervention also carries political and diplomatic risks. It can draw criticism for currency manipulation, especially when intervention is aimed at weakening the yen, a direction that can help exporters with trade. That charge is harder to argue when Tokyo acts to support the yen.What is the US stance on a weak yen?Trump accused Japan’s leaders of guiding the yen lower to gain a competitive advantage in early March and said tariffs were the solution. Japan remains on the US Treasury Department’s “monitoring list” for foreign-exchange practices after posting trade and current account surplus against US, but doesn’t fulfil all the conditions to be characterised as a currency manipulator.Tokyo and Washington issued a joint statement in September, in which the two finance chiefs reaffirmed that intervention “should be reserved for dealing with excess volatility or disorderly movements” and not for competitive advantage. Still, Treasury Secretary Scott Bessent on October 7 said Japan’s government needed to give the central bank space to manage volatility — comments seen as a warning against excessive weakness in the yen.Any intervention would take place after prior notice to the US and if it ended up strengthening the yen, it may be tacitly welcomed by the Trump administration.

The dollar took a breather on Thursday after a strong run this week that has put it on track for its best performance in nearly a year, helped by a weak yen that has struggled amid a change of guard in Japan's ruling party. The Japanese currency was last a touch stronger at 152.49 per dollar, after having slid to an eight-month low of 153 per dollar overnight. The euro is also under pressure due to the escalating political crisis in France following the shocking resignation of Prime Minister Sebastien Lecornu and his government, although French President Emmanuel Macron is expected to appoint a new prime minister within 48 hours. The moves in the yen and the euro have in turn provided support for the dollar, which is up more than 1% for the week. Sterling rose 0.07% to $1.3413, after having touched a roughly two weeks previous session, while the Australian dollar was last up 0.11% at $0.6594. The New Zealand dollar rose 0.1 % to $0.5792, after falling in the previous session following the Reserve Bank of New Zealand's 50 basis point interest rate cut. Against a basket of currencies, the dollar was little changed at 98.77.

Qatar Central Bank's (QCB) foreign currency reserves and liquidity rose by 3.08% year-on-year in September 2025, reaching QR 261.050 billion, up from QR 253.242 billion a year earlier, according to data released by the Bank on Tuesday. Official international reserves increased by 3.73%, or QR 7.262 billion, to QR 201.548 billion at the end of September, compared with QR 194.286 billion in September 2024. Holdings of foreign bonds and treasury bills, however, declined by around QR 3.947 billion to QR 132.879 billion. The Bank noted that official reserves mainly comprise foreign bonds and treasury bills, cash balances with foreign banks, gold holdings, Special Drawing Rights (SDRs), and Qatar's quota at the International Monetary Fund (IMF). Additional liquid assets such as foreign currency deposits are also included in the total international reserves. Meanwhile, gold reserves surged by nearly QR 17.953 billion to QR 52.030 billion at the end of September, compared with QR 34.077 billion in September 2024. Qatar's SDR deposits with the IMF edged down by QR 38 million to QR 5.248 billion, while cash balances at foreign banks decreased by about QR 6.706 billion to QR 11.390 billion over the same period.

The dollar index, which measures the greenback against a basket of currencies, added 0.05% to 98.17. While the yen weakened to a two-month low against the dollar. The yen lost 0.2% to 150.59 per dollar and earlier touched 150.62, the weakest level since August 1. Japan's currency also skidded to 176.35 per euro. The euro was little changed at $1.1705. The euro slid against the dollar and the pound in the previous session after France's new Prime Minister Sebastien Lecornu and his government resigned on Monday.

Having adopted one major piece of digital-currency legislation (the GENIUS Act) and with more pending (the CLARITY Act has passed the House of Representatives), the US is poised to become a major hub for cryptocurrency-related activities, or even – taking President Donald Trump literally – the “crypto capital of the world.” But those who support the new legislation should be careful what they wish for.Unfortunately, the crypto industry has acquired so much political power – primarily through political donations – that the GENIUS Act and the CLARITY Act have been designed to prevent reasonable regulation. The result will most likely be a boom-bust cycle of epic proportions.Historically, US financial markets’ major advantage compared to other countries has been relatively greater transparency, which enables investors to gain a deeper understanding of risks and make better-informed decisions. The US also has strict rules against conflicts of interest, requirements to treat investors fairly (including by protecting their assets in proper custody arrangements), and limits on how much risk many financial firms can take.This framework is not an accident or something that emerged purely through market competition. Rather, it is the result of sensible laws and regulations that were created during the 1930s (after a major disaster) and that have evolved in a reasonable fashion since then. These rules are the major reason why it is so easy in the US to do business, to bring new ideas to market, and to raise capital to support innovation of all kinds.Any individual entrepreneur or even a potential new industry (such as crypto) may balk at these rules, claiming that they are different from anything the world has ever seen. But financial innovation involves risks for the entire financial system, not just for individual investors. The point of regulation is to protect the whole.Many major economies – including the US – learned this the hard way. Over the past 200 years, they have experienced severe financial disruptions and even systemic meltdowns. One such collapse was a major contributor to the Great Depression, which began with a stock-market crash in 1929 and spilled over to bring down many banks (and other investments), destroying millions of Americans’ wealth and dreams. Avoiding a repeat of that experience has long been an important policy goal.But the GENIUS Act does not advance this goal. The law creates a framework for stablecoins, an important emerging digital asset, issued by US and foreign firms, that purports to maintain a stable value against a particular currency or commodity, with the US dollar being the most popular anchor. Stablecoins are useful to investors active in cryptocurrency trading, enabling them to move into and out of particular crypto assets without having to navigate the traditional (non-crypto) financial system. We should expect significant demand, including from non-financial firms (such as Walmart and Amazon) seeking to bypass established payment systems.The business model of stablecoin issuers is to capture the spread between what they pay on their currencies (which is zero interest under this legislation) and what they can receive when they invest their reserves, just like a bank. All the incentives for stablecoin issuers are to invest at least some of their reserves in riskier assets to get higher returns. This will be a major source of vulnerability, particularly when issuers are licensed by permissive state authorities.Indeed, from a systemic perspective, the GENIUS Act’s main shortcoming is its failure to deal effectively with the inherent risk of stablecoin runs, because it prevents regulators from prescribing strong capital, liquidity, and other safeguards. And when any stablecoin issuer – domestic or foreign – gets into trouble, who will step in, and with what authority, to prevent the problems from spreading to the real economy, like in the 1930s?Simply applying the bankruptcy code to failed stablecoin issuers will inevitably impose severe costs on investors, including prolonged delays in receiving what’s left of their money. It will almost certainly exacerbate runs on other stablecoin issuers.Moreover, if the GENIUS Act’s goals include preserving the US dollar as the world’s reserve currency and boosting demand for Treasuries (as stated by its advocates), why does Section 15 of the law allow foreign issuers to invest their reserves in assets such as their own country’s (risky) government debt, even if that debt is not denominated in dollars? We should expect foreign regulators to condone or even favor such arrangements. But then we will have “stablecoins” with fixed dollar obligations, backed in significant part by non-dollar assets – and one can easily imagine what a big appreciation in the value of the dollar will do to such arrangements (spoiler alert: immediate liquidity problems, insolvency fears, and destabilising runs).There is a lot more trouble to come, particularly if any version of the CLARITY Act passes the Senate. This legislation would allow conflicts of interest and self-dealing on a scale not allowed since the 1920s. There are also major national security concerns, to the extent that both the GENIUS Act and the CLARITY bill allow or even facilitate the continued use of stablecoins (and crypto more broadly) in illicit financial transactions.The US may well become the crypto capital of the world and, under its emerging legislative framework, a few rich people will surely get richer. But in its eagerness to do the crypto industry’s bidding, Congress has exposed Americans and the world to the real possibility of the return of financial panics and severe economic damage, implying massive job losses and wealth destruction. – Project Syndicate*Simon Johnson, a 2024 Nobel laureate in economics and a former chief economist at the International Monetary Fund, is a professor at the MIT Sloan School of Management and the co-author (with Daron Acemoglu) of Power and Progress: Our Thousand-Year Struggle Over Technology and Prosperity (PublicAffairs, 2023).