United States Treasury Chief Becent has rarely publicly called on the Fed to expand a liquidity tool to help defend the yen

On 4 August, the United States Treasury Secretary, Scott Becent, called on the Federal Reserve to expand a tool that Japan could use to support the yen, once again drawing outside attention to the relationship between these two institutions, which usually operate independently. On Sunday, after the United States Treasury and Japan joined forces to support the yen, Becent praised the Federal Reserve’s Foreign and International Monetary Authority (FIMA) buy-back mechanism, which allows foreign governments to use United States bonds held by them as collateral for the United States dollar. In a social media post, Bercent described this Fed tool as an important support to Japan's action and stated that “we will encourage the scaling up of this measure in the coming months”. However, close attention to the Fed has been drawn to the fact that finance ministers rarely publicly urge central banks to modify any of their tools, especially a tool that falls within the decision-making competence of the Federal Open Market Commission. “This is very unusual,” said Mark Sobel, a former senior official of the Ministry of Finance. In my days, ministers of finance were reluctant to speak openly about issues related to the Fed’s currency operations, and if they really needed to do so, they would talk to the Fed’s president in private and deal with the matter behind the scenes