1 hr ago
Trump Raises Weak Yen Concerns as Japan Signals Currency Coordination
Donald Trump met Japanese Prime Minister Sanae Takaichi in New York.
During the meeting, Trump said he was worried that Japan’s yen was too weak.
Takaichi also said that an undervalued yen could be a problem.
Japan’s finance minister said Japan and the United States would keep talking about currency issues.
After those comments, the yen became slightly stronger against the dollar.
However, one market expert said words alone might not change the yen’s longer-term direction.
The United States and Japan had already joined a currency-market intervention in July to support the yen.
Japan’s central bank has raised interest rates and may raise them again, but stronger signals from the Federal Reserve have continued to affect trading.
Donald Trump told Japanese Prime Minister Sanae Takaichi that he was concerned about the yen’s weakness during their meeting in New York.
Japan’s Finance Minister Satsuki Katayama said Takaichi agreed that an undervalued yen was problematic.
Katayama said she would continue discussing foreign-exchange issues with US Treasury Secretary Scott Bessent.
The yen strengthened to about 158.33 per dollar from roughly 158.70 after Katayama’s remarks.
A market strategist said the comments were unlikely to significantly change the yen’s outlook without concrete policy action.
- Who
- US President Donald Trump, Japanese Prime Minister Sanae Takaichi, Finance Minister Satsuki Katayama, and US Treasury Secretary Scott Bessent.
- What
- Trump expressed concern about the yen’s weakness, while Japan indicated that it viewed an undervalued yen as problematic and would continue foreign-exchange discussions with the United States.
- Where
- The leaders met in New York on the sidelines of the UN General Assembly; Katayama spoke in Tokyo.
- When
- Trump and Takaichi met earlier this week; Katayama made the comments on Friday.
- Why
- The discussion focused on concerns that the yen was too weak and on possible coordination over foreign-exchange issues.
Japanese Officials’ Concern
Market Skepticism
Whether the comments will change the yen’s direction
Japanese Officials’ Concern
Japanese officials said a weak or undervalued yen was problematic and emphasized continued communication with US officials on foreign exchange.
Market Skepticism
Saxo Markets strategist Charu Chanana said the remarks were largely another attempt to influence markets and would not materially change the yen’s underlying outlook without actual policy coordination, intervention, or a clearer Bank of Japan tightening path.
Interest-rate support for the yen
Japanese Officials’ Concern
Bank of Japan Governor Kazuo Ueda has indicated that further tightening, including a possible October hike, remains possible.
Market Skepticism
The article says those signals were outweighed by more hawkish Federal Reserve rhetoric, leading traders to assign a 71% probability to another US rate increase at the Fed’s October 28 decision.
Key facts
- Yen movement
- The yen rose to around 158.33 per dollar from approximately 158.70 after Katayama spoke.
- Trump’s position
- Trump expressed concern about the yen’s weakness during his meeting with Takaichi.
- Japan’s position
- Takaichi said an undervalued yen was problematic, according to Katayama.
- Future coordination
- Katayama said she and Scott Bessent would continue communicating about foreign exchange.
- Earlier intervention
- The United States and Japan intervened together in the currency market in late July to boost the yen.
- Bank of Japan rate
- The Bank of Japan raised its policy interest rate to 1.25% on September 18.
- Possible further hike
- Bank of Japan Governor Kazuo Ueda said he would not rule out another increase in October or a larger move later.
Quotes
Satsuki Katayama
Japan’s finance minister
“US Treasury Secretary Bessent and I will continue to communicate closely on a range of issues, including foreign exchange.”
livemint.com
“At the recent Japan-US summit, President Trump expressed concern about the weakness of the yen”
livemint.com
Charu Chanana
Chief investment strategist at Saxo Markets
“This is largely another way of jawboning in my view. Unless it is followed by actual policy coordination, intervention or a clearer BOJ tightening path, I don’t think it changes the underlying yen story materially.”
livemint.com
Sources
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