Japan and U.S. Reaffirm Forex Coordination After Bessent Tokyo Visit

Yahoo Finance UK reported Tuesday that Japan and the United States have reaffirmed their commitment to close forex coordination. The pledge followed a bilateral meeting in Tokyo between Japanese Finance Minister Satsuki Katayama and U.S. Treasury Secretary Scott Bessent.

Katayama Confirms Japan US Forex Coordination

Katayama told reporters the two sides reviewed recent market developments. She confirmed Japan was acting in line with a joint currency statement both nations signed last September. That agreement gave Tokyo room to intervene against excessive yen volatility.

Katayama said the pair agreed their coordination on recent market moves had been extremely strong. She underscored the need to continue working together closely. When asked whether Washington might take a more active role in addressing sharp yen depreciation, she said discussions focused on deepening cooperation across multiple areas.

She declined to address whether the Bank of Japan’s monetary policy featured in the talks.

Background: Japan’s Suspected Yen Rescue Operation

The meeting comes as Japan faces mounting pressure on the yen. Tokyo is suspected of spending close to 10 trillion yen, roughly $63.5 billion, on yen-buying operations to arrest a prolonged slide. A weaker yen inflates import costs and squeezes household spending power.

Japanese officials have previously sought a public endorsement from Washington for their currency interventions. Such backing is seen as adding credibility and deterrent force to the operations. Some market analysts have also speculated Bessent might press for faster Bank of Japan rate hikes as an indirect way to support the yen.

BOJ Rate Path and Bessent’s Broader Tokyo Agenda

Internal BOJ discussions have already shifted in a hawkish direction. A summary of April meeting opinions showed at least one policymaker flagging a possible rate move as early as June. Elevated oil prices linked to geopolitical tensions have added to domestic inflation pressures and strengthened the case for tightening.

Bessent’s Tokyo schedule extends through Wednesday. He is expected to hold separate talks with Japanese Prime Minister Sanae Takaichi before departing. Markets will be watching closely for any joint statement that might signal a coordinated approach to yen stabilization.

The yen stood at approximately 157.52 per dollar at the time of reporting.

Read Next: Fed Holds Rates Steady as Powell Flags Uncertainty Over Trade Policy