Evercore: The Federal Reserve's liquidity tools are difficult to support long-term intervention in the yen

According to Jinshi reports, Evercore ISI stated that the long-term use of the Federal Reserve's foreign and international monetary authorities repurchase tool may prompt the market to test the determination of the United States and Japan to maintain the yen exchange rate. This tool allows overseas institutions to obtain dollars using U.S. Treasury bonds they hold as collateral, with a daily limit of $60 billion for each counterparty.

Evercore strategists pointed out that this limit is only slightly higher than the scale Japan used for currency market intervention last Thursday, emphasizing that the tool is designed for short-term liquidity support rather than a lasting source of financing.