Bessent Explains 'Buy Yen' Note, Backs Fed Foreign Repo Tool Expansion

U.S. Treasury Secretary Bessent has responded to questions about a handwritten note in which he wrote 'buy yen.' He said the purpose of that note was to make sure reporters could see it, and that he had observed excessive volatility in the Korean won. Bessent also voiced an optimistic view of Japan's policy path, saying that while intervention can send a signal to the market, policy is the key factor. Turning to the Federal Reserve, he argued that it is reasonable for the Fed to consider expanding its repurchase agreement facility for foreign and international monetary authorities. He made the point that this facility is no different from a foreign exchange swap line, describing the two as equivalent in nature. Bessent's remarks were reported by Jinshi. The comments touch on three areas: the notebook note and what he wanted reporters to see, his outlook on Japan's policy path, and the Fed's possible expansion of its foreign repo tool. No further policy details were included in the reported comments. Overall, Bessent distinguished between the signaling effect of intervention and the more fundamental role of policy, while endorsing the Fed's contingency tool as consistent with existing mechanisms.