Finance
NY Fed carried out dollar/yen rate checks, source says
Published by Global Banking and Finance Review
Posted on January 23, 2026
2 min readLast updated: January 23, 2026
Quick Summary
The NY Fed's dollar/yen rate checks suggest possible intervention, causing a significant drop in the dollar against the yen.
NY Fed Conducts Dollar/Yen Rate Checks Amid Market Fluctuations
Impact of NY Fed's Rate Checks on Currency Markets
By Gertrude Chavez-Dreyfuss
Market Reactions to Rate Checks
NEW YORK, Jan 23 (Reuters) - The New York Federal Reserve conducted rate checks on the dollar/yen pair around midday on Friday, a source familiar with the matter told Reuters.
Potential for Currency Intervention
Analysts say the move may have triggered a sharp drop in the greenback and could signal that U.S. and Japanese monetary authorities may be preparing to act after weeks of sustained dollar strength against the yen.
Data Release from Bank of Japan
The dollar slid from around 157.50 yen at midday to a four-week low of 155.66 in the afternoon. It was last down 1.6% at 155.85 yen.
Acting as fiscal agent for the U.S. Treasury, the NY Fed carried out the rate checks, the source said.
The U.S. Treasury did not respond to Reuters’ requests for comment.
A rate check, in which officials ask dealers what price they would get if they entered the market, is something monetary authorities can use to signal their readiness to do so.
Traders have been wary of intervention by Japanese authorities as the yen has approached 160 per dollar.
Whether actual intervention took place might be inferred from data the Bank of Japan is set to release on Monday at 1800 JST (0900 GMT).
Analysts said U.S. monetary authorities stepping into what began as a Japanese affair is not typical, but it is not without precedent.
(Reporting by Gertrude Chavez-Dreyfuss; Editing by Chris Reese and Lisa Shumaker)
Key Takeaways
- •NY Fed conducted rate checks on the dollar/yen pair.
- •The dollar dropped sharply against the yen following the checks.
- •Potential U.S. and Japanese currency intervention is suggested.
- •The Bank of Japan is set to release relevant data soon.
- •U.S. involvement in Japanese currency matters is unusual.
Frequently Asked Questions about NY Fed carried out dollar/yen rate checks, source says
1What is foreign exchange?
Foreign exchange, or forex, is the global market for trading national currencies against one another. It is the largest financial market in the world, where currencies are bought and sold.
2What is monetary policy?
Monetary policy refers to the actions taken by a country's central bank to control the money supply and interest rates to achieve macroeconomic objectives such as controlling inflation, consumption, growth, and liquidity.
3What is a currency intervention?
Currency intervention is an action taken by a central bank to stabilize or increase the value of its currency by buying or selling its own currency in the foreign exchange market.
4What are currency markets?
Currency markets, also known as forex markets, are platforms where currencies are traded. They facilitate the exchange of one currency for another and are crucial for international trade.
5What is the role of the Federal Reserve?
The Federal Reserve, often referred to as the Fed, is the central bank of the United States responsible for implementing monetary policy, regulating banks, maintaining financial stability, and providing financial services.