For the first time in 15 years, Washington and Tokyo conducted a joint currency intervention to halt the yen's collapse. However, the diplomatic rapprochement on the financial front does not stop Japan from lodging complaints against the United States over the use of iconic characters in official memes.
The yen plunged to 163.7 per dollar — its lowest level in nearly four decades. The coordinated actions by the two governments, which took place on August 1, brought the exchange rate back to 155. This is the first such intervention by U.S. authorities since 1998, underscoring the exceptional nature of the current situation.
A gesture of goodwill or a forced measure?
U.S. Treasury Secretary Scott Bessent confirmed the American side's participation in purchasing yen alongside Japan's Ministry of Finance. Notably, Donald Trump characterized these actions as a "gesture of goodwill" rather than a policy shift. According to him, Japan asked for help, and the U.S. could not refuse an ally.
The market received such rhetoric with mixed feelings. On one hand, coordination between the two largest economies demonstrates a readiness for decisive action. On the other, Trump's statement hints at the absence of systemic solutions, which could increase volatility in the medium term.
Conflict on the "meme front"
While financiers address exchange rate issues, Japan's Ministry of Foreign Affairs is fighting a different battle. Since March, Tokyo has been sending official complaints to Washington over the use of Nintendo, Pokémon, and Naruto characters in White House memes and videos on social media. The issue concerns posts where footage from games is combined with military themes, including strikes on Iran.
Pokémon previously denied granting permission for the use of its characters for governmental purposes. Japanese officials insist that consent from rights holders is required for anyone, including government entities. Notably, a grassroots group of fans has already run a campaign that drew global attention.
Whether time will show if currency cooperation leads to a compromise in intellectual property disputes remains an open question. On the financial market, the parties quickly found common ground, but there is no agreement regarding Mario.
My take: The joint intervention is a signal to the market that governments are not willing to tolerate speculative pressure on the yen. However, the lack of structural reforms and contradictions in other areas, including copyright, make this support more of a tactical measure than a long-term strategy. For the crypto market, this is an indirect positive: stabilization of fiat currencies reduces demand for hedging through digital assets, but in moments of uncertainty, it is Bitcoin that remains the main beneficiary.