Goldman Sachs: Yen Intervention Reinforces Dollar Dominance

On August 7, Goldman Sachs said that the recent intervention by the United States and Japan to support the yen has not weakened the dollar's status as the world's primary reserve currency, but rather strengthened it. The analysis noted that Washington's intervention in the euro/yen exchange rate and Japan's potential use of the Fed's FIMA dollar facility highlight the depth and liquidity of U.S. financial markets. Goldman Sachs believes that no competing reserve asset currently matches the dollar in terms of global infrastructure, liquidity, and practicality during periods of financial stress.