Overview

• Japanese Finance Minister Katsunobu Kato and U.S. Treasury Secretary Scott Bessent confirmed no discussion of specific yen-dollar exchange rate targets during their meeting in Washington.
• Both nations reaffirmed that exchange rates should be determined by market forces and committed to close and constructive consultations on currency matters.
• The Bank of Japan signaled readiness to continue rate hikes, aligning monetary policy with wage and price developments while monitoring tariff impacts.
• The yen, which briefly strengthened to ¥139.9 per dollar earlier in the week, settled at approximately ¥142.9, reflecting cautious market sentiment over potential U.S. pressure.
• A second round of bilateral trade talks between Japan’s Ryosei Akazawa and U.S. officials is scheduled for next week, with currency issues expected to remain a key topic.