Confirmation of joint intervention marks a significant shift from Japan acting alone, and the scale reported, with the Bank of Japan data suggesting up to $58.97 billion sold to support the yen, signals a determined effort to defend the currency from its weakest levels against the dollar since 1986. The coordination with Washington, including Treasury's private warning to banks to stand ready for further action, suggests markets should expect continued volatility around USD/JPY as authorities test the durability of any bounce. The BOJ's parallel signal that a rate hike is likely soon adds a monetary policy lever alongside intervention, narrowing the rate differential that has driven dollar strength. Rising US Treasury yields appear to be a shared concern underpinning the cooperation, meaning any renewed yen weakness could quickly reignite pressure on US bond markets as well as Japanese assets. --- Tokyo and Washington have moved together to defend the yen for the first time in 15 years, blending intervention with a looming BOJ rate hike.Summary:Japan's Finance Minister Satsuki Katayama is set to announce Monday that Tokyo and Washington conducted joint currency intervention, sources told ReutersIt would be the first joint yen intervention since 2011, aimed at arresting the currency's fall to 40-year lowsJapan bought yen for dollars during New York trading hours Thursday, with BOJ data suggesting sales of up to $58.97 billionThe BOJ kept policy steady Friday but signalled a strong chance of a rate hike soon, a move announced shortly before a suspected second bout of interventionThe US Treasury told banks Friday to stand ready for future action, with Secretary Scott Bessent reportedly noting a plan to buy $5-10 billion in yenJapan's Ministry of Finance posted in English on X that it has tools including access to the Fed's repurchase facility to address liquidity needsJapan's Finance Minister Satsuki Katayama is expected to confirm on Monday that Tokyo and Washington carried out joint intervention in the currency market to halt the yen's slide to 40-year lows, according to two Japanese government officials cited in a Reuters report over the weekend. It would mark the first joint yen intervention since 2011 and the currency's lowest level against the dollar since 1986.According to the sources, Katayama is likely to stress the determination of both countries to combat what they view as excessive yen weakness. One source told Reuters the operation was "still ongoing" when asked to confirm joint action. Japan reportedly bought yen for dollars during New York trading hours on Thursday, with Bank of Japan data suggesting sales of as much as $58.97 billion to support the currency. That initial move came hours before the BOJ's Friday decision to hold policy steady while signalling a strong chance of a rate increase soon, a widening rate gap with a more hawkish Federal Reserve having been a central driver of dollar strength. The yen spiked again shortly after BOJ Governor Kazuo Ueda's press conference, in what markets suspected was a further round of intervention, with top currency diplomat Atsushi Mimura saying he intended to coordinate closely with monetary policy.The US side of the coordination was also evident on Friday, when the Treasury reportedly told a number of banks it might intervene in the yen market and should stand ready for future action. Treasury Secretary Scott Bessent, who had said the previous week that the yen looked very undervalued, was photographed at a cabinet meeting with a notepad reading "Buy Japanese Yen (JPY) $5-10 bil." Separately, Japan's Ministry of Finance made a rare English-language post on X stating it had a broad range of tools to address market liquidity needs, including access to the Federal Reserve's repurchase facility, which allows Tokyo to raise dollar liquidity without directly selling US Treasury holdings.Analysts see the cooperation as partly driven by shared concern over rising US Treasury yields, since a failure to stem yen and Japanese government bond selling could worsen pressure on US debt markets. Former BOJ official Nobuyasu Atago told Reuters that both countries face the risk of inflation running hot and their central banks falling behind the curve, giving them clear incentive to work together. Japan's Economy Minister Minoru Kiuchi said Sunday the government would step up communication with markets, calling it essential to maintain trust in the country's fiscal sustainability. With rate policy, intervention and bilateral coordination now converging, attention turns to whether the joint action can durably stabilise the yen or merely buys time ahead of further BOJ tightening. Japan's Finance Minister Satsuki Katayama This article was written by Eamonn Sheridan at investinglive.com.