Japan, US reaffirm yen coordination

Japan, US reaffirm yen coordination

Japan and the United States have agreed to continue working together to ensure orderly movements in the yen, which they say are important for maintaining stability in global financial markets.

Japanese Finance Minister Satsuki Katayama said after meeting US Treasury Secretary Scott Bessent that both sides reaffirmed their previous position following last month’s rare coordinated intervention in the currency market.

The yen has recently weakened towards 160 against the US dollar, raising concerns that Japan could intervene again to support the currency. Katayama said Japan remains prepared to respond if exchange-rate movements become disorderly, stressing that coordination between Tokyo and Washington remains ongoing.

The bilateral meeting marked the first face-to-face talks between Katayama and Bessent since the two countries jointly intervened in the yen market last month. The meeting took place on the sidelines of the two-day Group of 20 finance leaders’ gathering in Asheville, North Carolina.

Katayama declined to say whether the yen’s recent decline towards 160 per dollar qualified as an orderly move, saying it was difficult to determine the factors behind exchange-rate fluctuations.

Her comments differed from Bessent’s assessment. He told Reuters on Sunday that recent movements in the yen were “pretty well contained”, indicating that Washington did not view the latest decline as similar to the disorderly market conditions that prompted last month’s intervention.

Katayama said the two countries had confirmed that stable and orderly yen movements were essential for global financial stability, including in the United States. She added that continued cooperation between Japan and the US would help achieve that objective.

The Japanese minister also told her US counterparts that last month’s coordinated intervention complied with international agreements, including commitments made through the Group of Seven.

Japan’s top currency diplomat Atsushi Mimura, who attended the meeting, described the discussions on future cooperation over currency policy as constructive.

The coordinated intervention last month briefly strengthened the yen after it fell to a four-decade low of nearly 164 per dollar. However, the currency has since weakened again, raising fresh questions about whether Japan may need to take further action.