Just like with the yen, America cannot save the AI bubble

The US has intervened in the foreign exchange market for the first time in decades, buying Japanese yen in a coordinated effort with Japan. This move aims to stabilize the global economy by preventing a further rise in US government bond yields, which could have a negative impact on the US artificial intelligence sector. The AI bubble is a concern because it is heavily reliant on cheap funding, and a rise in yields could make it harder for companies to access capital. This intervention may provide temporary relief, but its long-term effectiveness is uncertain.

Why it matters

The US intervention to prop up the yen signals a desire to manage yields and currency markets. This could lead to a decrease in the value of the US dollar.

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• Team America: Yen police Financial Times · 2026-08-03

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