Bundesbank president criticizes US for selling euros to prop up the yen without telling Europe first

Joachim Nagel, the president of Germany’s Bundesbank and a member of the ECB Governing Council, went public on September 1 with a pointed rebuke of the United States for selling euros to support the Japanese yen, all without giving European partners a heads-up beforehand.

The move, which took place around July 31, represented the first joint US-Japan currency intervention in roughly three decades. And the ECB only found out about it after the trades had already been executed. Nagel’s word for it: “blindsiding.”

What actually happened

In late July and early August, Japan was staring down a sharp depreciation of the yen. Tokyo responded aggressively, with Japanese interventions totaling approximately ¥13.8 trillion, or around $87 billion, over just two days.

The US joined the effort by selling euros to purchase yen on behalf of the Treasury’s Exchange Stabilization Fund. That’s the key detail that has European officials fuming. Washington didn’t sell dollars to buy yen. It sold Europe’s currency.

The ECB was informed only after the fact. Under the unwritten rules that have governed coordination among Western central banks since the post-World War II era, that’s a serious breach of protocol. Major economies have traditionally consulted each other before executing large-scale currency interventions, precisely because these moves ripple across global markets in ways that affect everyone.

Why this is historically unusual

The last time the US and Japan cooperated on a yen-supporting intervention was in 1998, during the Asian financial crisis. The last coordinated G7 intervention involving the yen came in 2011, after Japan’s devastating earthquake and tsunami prompted a surge in the currency that threatened to cripple the country’s recovery.

Both of those efforts were multilateral. They involved advance coordination, shared objectives, and mutual agreement among the world’s largest economies. The 2026 intervention broke that pattern entirely.

Nagel emphasized that better coordination is needed going forward. His public remarks reflect a broader sentiment among European policymakers that the incident isn’t just a diplomatic slight. It’s a signal that the cooperative frameworks underpinning global monetary stability may be fraying.