Japan’s top currency diplomat Atsushi Mimura has urged financial markets to take seriously the “very clear” warning delivered by Tokyo and Washington over the yen’s recent weakness, signaling that Japanese authorities remain prepared to respond if the currency falls excessively.
Mimura, vice finance minister for international affairs, said Japan’s prime minister, finance minister and the United States had collectively sent a clear message about the yen. He declined to say whether another currency intervention was being considered but said he remained neither satisfied nor reassured by the yen’s recent movements.
The warning follows concerns raised by US President Donald Trump about the yen’s weakness during his meeting with Japanese Prime Minister Sanae Takaichi. Japanese Finance Minister Satsuki Katayama and US Treasury Secretary Scott Bessent also reaffirmed in a phone call that the yen’s undervaluation was a concern.
Japan and the United States have already demonstrated a willingness to cooperate on currency markets. The two countries carried out a rare joint yen-buying intervention in July, aimed at limiting excessive market moves. The action, however, did not establish a lasting floor for the Japanese currency.
The yen’s weakness has become a concern for Japanese policymakers because a cheaper currency increases the cost of imported goods, particularly energy. The pressure comes despite the Bank of Japan having raised interest rates to their highest level in decades, while the gap between Japanese and US interest rates continues to influence currency markets.
Mimura stopped short of identifying any specific exchange-rate level that would trigger action. Instead, he emphasized that officials were watching market movements closely and would assess whether traders were taking the government’s warnings seriously.
The latest comments have already shown an effect on currency trading. The yen strengthened slightly after Mimura’s remarks, reflecting the sensitivity of markets to signals that Japanese authorities could intervene again.
For now, Tokyo has not announced another intervention. The focus remains on whether continued yen weakness becomes sufficiently disruptive for Japanese authorities to take further action, while investors monitor interest-rate expectations, US-Japan policy coordination and developments in global energy markets.
