US Treasury Secretary Scott Bessent said the yen's recent slide remains contained and does not resemble last month's disorderly swings that triggered joint US-Japan intervention. He is deferring rate decisions to Bank of Japan Governor Kazuo Ueda ahead of their meeting at the G20 finance leaders' gathering in Asheville, and said Japan has probably reached the end of Abenomics.
Yen slide draws no new intervention signal
US Treasury Secretary Scott Bessent said on Sunday that recent yen moves remain well contained, not the kind of disorderly swings that led to a rare joint US-Japan currency intervention last month.
Asked whether the yen was still making disorderly moves, Bessent told Reuters "I think it's pretty well contained."
Bessent defers to Ueda on rate policy
Bessent declined to say whether the central bank should pursue consecutive rate hikes, but expects Governor Kazuo Ueda to make the right calls with the backing of Prime Minister Sanae Takaichi. He has known Ueda for 15 years and considers him an underrated, savvy market operator. The two are set to meet at the G20 finance leaders' gathering opening Monday in Asheville, North Carolina.
Markets are already pricing an 80% to 90% chance the Bank of Japan raises rates in September.
Japan nears the end of Abenomics
Bessent also said Japan has probably reached the end of Abenomics, the reflationary program. Crypto Briefing reported the program was launched by former prime minister Shinzo Abe. With Takaichi's government pulling back from direct intervention in economic policy, he said Tokyo should let the program's gains continue to play out rather than add new stimulus.
The comments follow a rare joint intervention by Japan and the US last month, when the yen slid to roughly 163.73 per dollar before rebounding. The currency has since traded at approximately 160 per dollar.
Sources: Investinglive, Investing.com, Crypto Briefing
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