While the BOJ understandably refuses to admit it spent a record $140BN (across all markets, $90BN on EBS) to briefly manipulate the Japanese yen higher...
... ahead of yet another disappointing (non-rate hike) decision (according to some calculations, Japan's central bank is about 100 bps of rate hikes behind to stop the ongoing collapse of the yen), others are less shy.
According to Reuters, similar to the last failed intervention by Japan and citing "a source familiar with the matter", the US Treasury informed a number of banks that it may intervene in the Japanese yen market on Friday and that they should "stand ready for future action."
The notice to banks, channeled through the Federal Reserve Bank of New York, comes a day after Japanese authorities stepped in to prop up the yen, setting the currency up for its biggest weekly rise since February, pulling it off of four-decade lows against the dollar (although the yen has since erased much of its gains).
News of the potential intervention by the U.S. Treasury helped push the yen higher against the dollar on Friday. It last traded at 159.22 to the dollar after trading as low 163.65 on Thursday. As shown below, the past 48 hours have seen no less than 5 distinct intervention attempts by the BOJ and/or the US Treasury to push the yen higher.
The method of potential Treasury intervention was not immediately clear. The Federal Reserve has maintained a dollar liquidity swap line with the Bank of Japan and four other major central banks since 2013.
Japan's top currency diplomat Atsushi Mimura in Tokyo Friday declined to comment on intervention but hinted at U.S. involvement in the effort to stem the yen's decline, including so-called "rate checks" -- requests to dealers for indicative dollar/yen quotes that are considered a precursor to interventions.
Mimura added that the U.S. support "goes beyond psychological support."
The Reuters report of Treasury's notice to banks of potential intervention "fits in with the view in the market that the New York Fed has been carrying rate checks, so it's adding to the nervousness of market participants that there could be further intervention," said Lee Hardman, currency strategist at MUFG in London. "It definitely helps support the idea that there is intervention risk on the table."
US Treasury Secretary Bessent said in a post on X that the Treasury maintains "a strong relationship and close coordination" with Japanese authorities, but did not confirm the intervention preparations.
He said he looked forward to meeting with Bank of Japan Governor Kazuo Ueda at the U.S.-hosted G20 finance ministers and central bank governors meeting in Asheville, North Carolina, at the end of August.
"Japan's economy continues to perform well under Prime Minister Takaichi, Governor Ueda and the Bank of Japan Board, which has demonstrated a strong commitment to monetary and financial stability,"
On Thursday, Bessent told Fox Business Network that the yen "seems very undervalued to me" and that Japanese Prime Minister Sanae Takaichi was enacting "strong policies" that would help Japan's economic fundamentals. Bessent added that "we think excess volatility in the yen isn't healthy" and that the yen has "substantially overshot what would be called an equilibrium price."
The last time that the US Treasury intervened directly to prop up Japan's yen was in 2011 as part of a coordinated action by G7 countries to stabilize the currency following the devastating earthquake and tsunami rocked Japan.
The Treasury last fall intervened to prop up Argentina's peso market ahead of parliamentary elections and provided President Javier Milei's government with a $20 billion currency swap line to help stabilize the currency and Argentina's dollar bonds. The aid to Argentina relied partly on the Exchange Stabilization Fund, which had total assets of about $217 billion as of June 30.
Tyler Durden Fri, 07/31/2026 - 14:00Summary:
After Italy's government and top French conservative politicians demanded the suspension of Schengen arrangements with Spain following the invasion of 50,000 military-aged illegal aliens in the Spanish enclave of Ceuta, Euronews reporter Gabriele Barbati reported that Italy's Interior Ministry had suspended Schengen free-movement rules with Spain and ordered the closure of air and maritime borders between the two countries, citing national security concerns.
GB News reports:
🚨 BREAKING: Italy has suspended the Schengen agreement with Spain after 60,000 migrants broke into Spanish territory. The Italian Ministry of the Interior has ordered the closure of the sea and air borders with Spain.
🇬🇧 Become a Friend of GB News: https://t.co/RxzT9yFXwS pic.twitter.com/0Opt8idvBP
The measure was announced by Prime Minister Giorgia Meloni and Deputy Prime Ministers Antonio Tajani and Matteo Salvini, and was formally approved earlier today after an Interior Ministry review of migration and border-security risks.
Meloni writes on X:
The Government has decided to temporarily suspend the free movement regime provided for by Schengen in maritime and air connections with Spain, reintroducing border controls. This is an extraordinary measure, adopted to safeguard national security and prevent possible repercussions for our Nation. The measure will be kept in force only for the time necessary, with particular attention to limiting any impact on summer tourist flows. In parallel, Italy is ready to support every European initiative to assist Spanish institutions as needed to restore full control of the Union's external borders and to address the ongoing situation with determination. Defending borders means defending the safety of citizens, combating irregular immigration, and striking at the criminal networks that traffic human beings.
Il Governo ha deciso di sospendere temporaneamente il regime di libera circolazione previsto da Schengen nei collegamenti marittimi e aerei con la Spagna, reintroducendo i controlli di frontiera.
Si tratta di una misura straordinaria, adottata per tutelare la sicurezza nazionale… pic.twitter.com/bpszoG8soX
Tajani writes on X:
The temporary suspension of #Schengen with Spain is a necessary choice to safeguard the security of our citizens and defend the European borders. A measure provided for by the treaties and made unavoidable today. The migrant crisis in #Ceuta reminds us that the management of the Union's borders is a shared responsibility among our countries, one toward the other. We must work together to prevent uncontrolled migrant flows from entering EU territory, with all the consequent risks and the threat of terrorism, which must be countered without hesitation.
La sospensione temporanea di #Schengen con la Spagna è una scelta necessaria per tutelare la sicurezza dei nostri cittadini e difendere le frontiere europee. Una misura prevista dai trattati e resa oggi ineludibile. La crisi dei migranti a #Ceuta ci ricorda che la gestione dei…
— Antonio Tajani (@Antonio_Tajani) July 31, 2026The Schengen Agreement allows people to travel between participating European countries without routine passport or immigration checks at internal borders.
Suspending Schengen arrangements could weaken the European Union by disrupting trade and travel. Restoring borders and ramping up border security would be a major setback for socialists and the far left in Europe, who have been hellbent on a decade or more of mass migration.
If temporary border controls become more permanent or spread across the bloc, they could undermine one of the EU's defining achievements: the free movement of people and goods.
"The world begins to isolate Spain," X user Agustín Antonetti wrote earlier.
🇪🇸🇮🇹 | HISTORICO — Es oficial.
Italia acaba de suspender el acuerdo Schengen con España. Los españoles ya no podrán ingresar libremente al territorio italiano, necesitaran visados o controles (a definir) como el resto de los países no europeos.
El mundo comienza a aislar a… pic.twitter.com/jsA8Z1MXmW
Spain's socialist-led government has pursued mass migration policies while advancing a mass-amnesty program that could legalize as many as one million illegals.
Against that backdrop, the Trump administration has increasingly aligned itself with nationalist, anti-socialist, and pro-American political movements across the West and, more recently, across the Americas.
.@SecRubio: "For the first time in 15–20 years, the overwhelming majority of the countries in the Western Hemisphere are now led by pro-American leaders and governments since @POTUS was elected president." pic.twitter.com/qr0sFuRXKn
— Department of State (@StateDept) July 31, 2026The Ceuta crisis serves as yet another case study for those warning about mass migration policies that threaten national sovereignty, internal security, and political stability.
Related:
Invasion: 50,000 Illegals Invade Spanish Enclave In 24 Hours, Chaos UnfoldsNew figures from Spain's Department of National Security indicate that 49,000 people illegally entered the Spanish enclave of Ceuta within 24 hours, according to Reuters.
Just kidding, this is the actual footage … pic.twitter.com/jYRpSWM24e
— Elon Musk (@elonmusk) July 31, 2026For context, Ceuta has only about 84,000 residents, meaning the invasion is equivalent to nearly 60% of its population.
The population of Cueta is about 85,000 people.
The civil guard is apparently reporting that 40,000 Moroccans have flooded in.
The romans invaded Britain with the same number. https://t.co/ZeLFY3TEat
The invasion of tens of thousands, in what only appears to be large numbers of military-aged men traveling without food, shelter, baggage, or money, is difficult to explain as spontaneous migration alone.
ESTO ES MUY GRAVE. Me llegan estas imágenes de cómo las autoridades marroquíes vacían camiones llenos de jóvenes cerca de la frontera con Ceuta.
Quien no quiera ver que se trata de una operación perfectamente preparada por el régimen, es que es ciego. pic.twitter.com/YpxFAaF7Wb
A Moroccan border guard opens a gate and lets through dozens of illegal migrants toward the Spanish border fence in Ceuta.
The Moroccan state is coordinating the invasion of Spanish territory.
🇪🇸🇲🇦 pic.twitter.com/yqNbW1QEec
At minimum, it suggests organized and deliberate, with high amounts of coordination on the Moroccan side.
Morocco didn’t send 40,000 of its own people into Ceuta and Melilla all at once, with no food or shelter, by accident.
They are using their people to take over Ceuta and Melilla.
Now they are breaking in homes, looting, and setting fires, while the people living there are… pic.twitter.com/EUdSRy0r7b
The immediate effect is to overwhelm Ceuta's border security, law enforcement, housing, and humanitarian capacity. If state-enabled, the operation would fit what can only be described as hybrid or asymmetric warfare: weaponizing migration and civilian populations to impose political pressure while preserving plausible deniability.
Earlier this year, Spain's socialist Prime Minister Pedro Sánchez dismissed criticism from Elon Musk and others over his open border globalist policies. His government subsequently granted amnesty to illegal aliens, with Sánchez declaring: "Spain is a welcoming country, and this is the path we choose."
In January, Spain's Pedro Sánchez dismissed Elon Musk’s criticism of his immigration policies.
Today, thousands of illegal immigrants are pouring across Spain’s border.@elonmusk @sanchezcastejon https://t.co/tPsVzlDOpX pic.twitter.com/ZOLFBi2uq7
The invasion of military-aged Moroccan men that is overwhelming local security and humanitarian services will intensify criticism of Sánchez's unhinged left-wing immigration policies and raise concerns about national security. This will strengthen support among common-sense right-wing politicians across Europe who have been pushing for closed borders.
🇪🇸🇲🇦 Riots erupted in Ceuta as migrants clashed with security forces thoughout the night.
There were reports of damage to private property, vehicles being set on fire, businesses being looted, and homes being illegally occupied.
Follow: @europa pic.twitter.com/iT8deLYaBf
"In the face of the massive and coordinated influx of migrants into Spain — encouraged by the Spanish government — France must immediately strengthen its border controls," Marine Le Pen of France's right-wing National Rally wrote on X.
Italy's right-wing Prime Minister Giorgia Meloni said her country was prepared "to intervene with extraordinary measures to defend the borders and the safety of citizens, including the suspension of the Schengen Area with Spain."
"The images coming from Ceuta show how the Madrid Government's decision to grant Spanish, and therefore European, citizenship to over 500,000 irregular immigrants is profoundly wrong and encourages human trafficking," Italy's Foreign Minister Antonio Tajani wrote.
The emerging news cycle across the West could very well frame the crisis as a predictable result of the socialists' "suicidal empathy" and nation-killing open border policies. The footage alone could sway undecided voters regarding the consequences of open borders. In the US, Trump and the GOP will almost certainly use the footage against the Democratic Socialists of America and the broader far-left movement, portraying their immigration agenda as an effort to dismantle national borders and linking it directly to the policies pursued under the Biden-Harris regime.
"Looks Like World War Z!": Spain's Ceuta Invaded By Thousands Of Military-Aged Male IllegalsShocking footage circulating on X shows thousands of migrants breaching Spain's border into its North African enclave of Ceuta from Morocco on Thursday, overwhelming local police and exposing a serious national security failure.
The invasion comes shortly after Prime Minister Pedro Sánchez's Socialist-led government signed up 1 million illegal aliens to legalize their status under a new program to bring them into the workforce. However, the program applied only to migrants already living in Spain before Jan. 1, meaning Thursday's arrivals are ineligible.
Sánchez has defended his government's mass amnesty for illegals by claiming Spain's GDP would crater by 20% by 2050 without continued immigration.
Sánchez said Spain would lose 19% of its GDP by 2050 - and 22% by 2075 - if migration were sharply reduced, presenting immigration as essential to the country's long-term economic growth.
Thousands of fighting age men who invaded Spain today have begun breaking into people's homes, where women and children live.
It's an invading army.
This is what an invasion looks like. pic.twitter.com/nd99hqT0gw
North African Muslim criminals have just broken into Spain from Morocco via Ceuta. Europe is under attack. pic.twitter.com/kehj5LHvec
— RadioGenoa (@RadioGenoa) July 30, 2026Almost entirely men of military age. https://t.co/0oTYCCQXT3
— Bill Melugin (@BillMelugin_) July 30, 2026Today's invasion has prompted us to examine whether left-wing NGOs coordinated with or received support from elements of the Spanish government.
"We're working on an immediate response to the situation in Ceuta"
>Refuses to send in the military for a literal southern border invasion. https://t.co/BhMfIvJDVs
No public evidence has established such coordination, making this an outstanding question at the moment.
They call it a "liberation" of Ceuta, a handover back to its owners. @mattvanswol is right on the money. It's an invasion. pic.twitter.com/vGPCQjqgTd
— DataRepublican (small r) (@DataRepublican) July 30, 2026Footage:
Holy. Shit.
Spain's far-left PM Pedro Sanchez gave amnesty to 1,000,000+ illegal immigrants, and now hordes of unvetted men are storming across the border from Africa.
It’s the same playbook across the West.
These people will destroy our civilization. pic.twitter.com/NcERXfTbPv
🇪🇸 Sánchez’s government does not consider the invasion of Ceuta a “national emergency”
The Interior Ministry said it will protect border integrity but cannot declare a formal national emergency solely over migration.
As a result, Ceuta’s local authorities cannot access special… pic.twitter.com/rXGdIdBNxK
🇪🇸 Thousands of African migrants who illegally invaded Spain today are celebrating their arrival
Soon, Sánchez’s government will issue them legal documents, and they will disperse across Europe. pic.twitter.com/Yx5YDRrnXy
Musk chimed in:
Looks like World War Z! https://t.co/GCqWAruEEA
— Elon Musk (@elonmusk) July 30, 2026In the US, Democratic Socialists of America politicians have unveiled a plan to collapse the nation's borders, similar to what was done under the Biden-Harris regime era, increase sanctuary protections, and grant mass amnesty to all illegals. These policies are nation-killing, as the Federal Reserve Bank of Dallas said that housing prices and rents soared when the Biden regime allowed millions of illegals to flood the nation.
The most observable threat is that this is a "war on the West" waged by globalists and pushed by the left wing to destroy borders across the Western world. These illegals become voting blocs that displace native-born workers, essentially stealing political power - and the establishment Democratic Party is now learning that the hard way.
All in all, the left wing says they're upholding democracy, yet no sane person voted for this invasion by the tens of millions across the West, which was forced down the throats of citizens.
Tyler Durden Fri, 07/31/2026 - 13:36Tesla is reportedly evaluating whether to separate its China operations through a sale, spinoff, or other restructuring as it considers a possible future merger with SpaceX, according to a new report from the Wall Street Journal.
The discussions reflect increasing geopolitical tensions between the United States and China, as well as the unique regulatory challenges that would arise if Tesla became part of a company with significant U.S. defense contracts.
The Journal reports that people familiar with the matter say Elon Musk has spent several years organizing Tesla so that its American and Chinese businesses can operate more independently. The strategy is intended to reduce risk if relations between the two countries deteriorate further, particularly in the event of conflict involving Taiwan or tighter restrictions on trade, technology, or critical supply chains.
Separating the China business could also help address concerns from both governments. Chinese regulators may be reluctant to allow a major U.S. defense contractor to oversee Tesla's manufacturing operations, technology, and customer data in China.
At the same time, SpaceX's work with the U.S. government subjects it to strict national security and export control requirements that could create additional complications if the two companies were combined.
China remains one of Tesla's largest and most important markets, accounting for about 18% of the company's sales while serving as a major production hub for vehicles and batteries.
Tesla has already taken steps to reduce its dependence on Chinese suppliers and strengthen the separation between its global operations. Although no decision has been finalized, reports indicate the company is evaluating multiple restructuring options as part of broader contingency planning. Musk has publicly denied the report, calling it "fake news."
Just a few months ago, Tesla's China president was quoted by local media as saying the Shanghai Gigafactory could eventually play a major role in mass-producing humanoid robots.
The Shanghai Morning Post quoted Allan Wang Hao, a senior executive at Tesla China, who said the Shanghai Gigafactory could provide a "golden key" to mass-producing the Optimus robot.
"Like other Tesla factories, Giga Shanghai can shoulder important responsibilities in manufacturing all new products, including robots, to make our contributions to the company," Hao said. "We are highly confident in welcoming the arrival of a new era of robots."
Tyler Durden Fri, 07/31/2026 - 13:25