Japan and the United States agreed to maintain close communications on foreign exchange issues but did not discuss a target for the value of the yen, Finance Minister Katsunobu Kato said after meeting with U.S. Treasury Secretary Scott Bessent in Washington on Thursday.
The possibility of the two countries committing to a specific number in terms of the yen-dollar exchange rate has helped drive up the value of the Japanese currency in recent days and added to uncertainty for investors.
“There was absolutely no discussion from the United States regarding things like target levels for exchange rates or any kind of framework to manage them,” Kato told reporters at a news conference on Thursday.
The Japanese finance minister is in Washington for a Group of 20 finance ministers meeting.
The two sides reaffirmed the understanding that exchange rates should be determined by the market and that excessive or disorderly movements can have adverse effects on economic and financial stability, Kato added. They agreed to continue “close and constructive consultations” on currency matters in the ongoing trade negotiations.
Japan’s central bank will carefully and appropriately monitor the data and make policy decisions accordingly, said Bank of Japan Gov. Kazuo Ueda, who is also in Washington for the meeting and attended the news conference with Kato.
“We will of course pay particular attention to data related to the mechanisms through which tariffs may have an impact,” Ueda added.
The yen broke the ¥140-to-the-dollar level earlier this week as the strengthening of the Japanese currency came into focus as a possible demand from the United States in tariff negotiations. It hit ¥139.9 to the dollar at one point.
The yen settled back as the week wore on and was trading at ¥142.9 by Friday morning.
