Treasury Secretary Scott Bessent (R) and Sen. Elizabeth Warren (D-Mass.).
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Treasury Secretary Scott Bessent unleashed a scathing personal attack on Sen. Elizabeth Warren on Friday, accusing the Massachusetts Democrat of being misinformed about foreign exchange markets, while leaving her with several questions about a rare U.S. intervention in Japan. circle Not answered.
“@SenWarren has revealed in his latest scientist letter to me that he knows even less about foreign exchange markets than he does about banking,” Bessent wrote to X about the top Democrat on the Senate Banking Committee. He gave Warren and her staff a tutorial on “Forex for Dummies” and criticized news outlets for failing to identify what he called her “correction mistakes.”
Warren fired back, pointing to a series of recent setbacks for the Treasury secretary.
“It’s been a tough few weeks for Secretary Bessent,” Warren wrote on XFriday. “His efforts to prop up foreign currencies are not working. His failed intervention in the U.S. debt market was slammed by the leader for burning the confidence of ‘two centuries’. The Trump economy is destroying families, so maybe that’s where he should focus.”
Mr. Bessent responded to Mr. Warren’s Aug. 13 letter, seeking details about the Treasury Department’s decision to sell euros and buy yen from the Exchange Stabilization Fund after Japan’s currency sank to a 40-year low.
Bessent said Warren’s opening sentence incorrectly suggested that Japan owed the Treasury when the senator wrote, “If Japan fails to repay the Treasury, American taxpayers will ultimately foot the bill.”
“The Treasury exchanged existing Exchange Stabilization Fund foreign currency assets into yen,” Bessent wrote in a response Thursday. “No new Congressional spending was involved, and no credit was extended to Japan. Japan owes nothing to the Treasury.”
Despite the initial wording, Warren’s letter then accurately described this intervention as a sale of the euro against the yen, and explicitly noted that Japan was not borrowing from the Treasury or the Federal Reserve.
Bessent defended the intervention as necessary to protect U.S. economic interests, arguing that a disorderly yen could destabilize world markets and raise U.S. borrowing costs. But Warren’s one-page response left some of her questions unanswered.
The most notable point is that although a July 31 Reuters photo shows Bessent’s memo saying, “Buy 5 billion to 10 billion dollars in Japanese yen (JPY),” Bessent has not disclosed how much yen the Treasury bought, the execution rate, or the current value of the position. He also did not say whether the European Central Bank was consulted before selling the euros or provide the detailed legal basis that Warren had requested.
This intervention was the first coordinated effort between Japan and the United States to strengthen the yen since 1998. Japan spent 15.4 trillion yen, or about $96.5 billion, on currency support from July 30 to Aug. 26, a record for the period, according to Japan’s Ministry of Finance data released on Friday.
Saloni Sharma, spokeswoman for Democrats on the Senate Banking Committee, said in a statement that Bessent should not dwell on “petty grievances with Sen. Warren” and instead “focus on lowering the cost of living for American families struggling in President Trump’s economy.”
The Treasury Department did not respond to requests for comment.
