Bessent and Japan Strike Same Note on the Yen: Wild FX Swings Are the Problem

Bloomberg, the Financial Times, the Wall Street Journal, and CNBC contributed to this report.

US Treasury Secretary Scott Bessent and Japan’s finance chief Satsuki Katayama are basically on the same page: nobody wants the yen whipping around like this. After meeting in Tokyo, Bessent said both sides believe “excess volatility is undesirable,” while Katayama said Japan and the US would keep working closely together on foreign-exchange moves.

That matters because Japan has been stepping into the currency market to prop up a weak yen, and Bessent’s comments read as tacit support for those moves rather than a public scolding. Reuters reported that he said Washington would stay in close contact with Japan’s finance ministry and that he had confidence the Bank of Japan would handle monetary policy successfully.

Katayama also said Japan’s interventions line up with the joint US-Japan statement from last September, which allows action against “excessive” volatility and disorderly currency swings. She declined to say whether the two discussed Bank of Japan policy, even though traders were watching for any hint that Washington wanted Tokyo to lean harder on rates.

The market heard the message loud and clear. The yen had been under pressure, and Bessent’s remarks were seen as softer than some traders expected, though the broader takeaway was simple: the US is not fighting Japan’s effort to stabilize its currency.

Bessent’s visit also went beyond forex. He met with Prime Minister Sanae Takaichi and later with Japan’s economy minister, Ryosei Akazawa, with the two sides also discussing energy and critical minerals.