The yen has resumed its slide, eroding gains after the U.S. Treasury intervened to prop it up, raising concerns about Japan’s spending direction. The government’s push for more domestic investment may boost bonds and the currency over time.

Sachs estimates Japan holds roughly $1 trillion in U.S. dollar reserves, with about $200 billion in cash or cash equivalents—enough for a couple more rounds of yen‑buying like last month’s historic intervention. Karen Fishman, a Research strategist, said on the Exchanges podcast that they have “enough to do another couple rounds.”

Japanese officials say they will act again, a stance that gains credibility after the U.S. intervened with Japan in 1998 and coordinated with G7 nations to curb yen gains. The July intervention, estimated at up to $85 billion, halted a slide toward 164 yen per dollar, the weakest level in four decades.

Praneet Shah, head of FX options at Goldman, says elevated short‑dated yen call premiums show the market stays wary of a sudden surge, and a larger war chest could deter selling. The yen’s 45% depreciation over five years is driven by a U.S. 10‑year Treasury yield of 4.69% versus Japan’s 2.84% bond yield; a September BOJ hike is priced at 65% chance, and cooler U.S. data may revive intervention bets.