The yen surged the most in more than two weeks after Japan’s finance minister revealed that President Donald Trump had voiced unease over the currency’s slide, sharpening the threat of another intervention in foreign-exchange markets.
The Japanese currency strengthened as much as 0.6% to 157.95 per dollar on Friday, leading gains among Group-of-10 peers. Finance Minister Satsuki Katayama told reporters that Trump raised the weak-yen issue during his meeting with Prime Minister Sanae Takaichi earlier in the week in New York, easing pressure that had built as the dollar pushed toward the 160-yen threshold.
Katayama also said she would maintain coordination with Treasury Secretary Scott Bessent. The remarks are likely to make traders wary of aggressive short positions on the yen, reinforcing the possibility that Tokyo could step into the market again if losses accelerate.
“Intervention risk should put a ceiling on further JPY weakness,” said Moh Siong Sim, a strategist at Oversea-Chinese Banking Corp. “More importantly, the JPY may be nearing a turning point as Trump’s concerns over its weakness point to deeper US-Japan coordination to support the currency.”
At a news conference after a cabinet meeting on Thursday, Katayama said Takaichi had conveyed “as a general view, the position that the yen’s undervaluation is a problem.” Publicly disclosing exchange-rate comments from a US-Japan leaders’ meeting is unusual, and local media including Kyodo News interpreted the move as an attempt by Japanese authorities to keep markets in check amid persistent yen weakness.
The currency has faced renewed selling as traders brace for additional Federal Reserve rate increases that could keep the US-Japan interest-rate gap wide. Uncertainty over the pace of Bank of Japan tightening has added to the pressure. Tokyo’s benchmark 10-year government bond yield climbed as high as 3.115% on Friday, the strongest level in roughly three decades.
Officials have consistently emphasized that they monitor the speed and disorderliness of moves rather than any specific level. Even so, market participants have treated the area around 160 as a zone where intervention risk escalates. On Sept. 18, after the BOJ lifted its benchmark rate to around 1.25% from around 1%, the yen briefly strengthened before renewed dollar buying sent it back toward the 158-159 range.
Japan and the US executed their first coordinated yen-buying operation since 1998 this summer after the currency weakened beyond 160. Tokyo spent a record ¥15.4 trillion (approximately $97.9 billion) on intervention in the month through Aug. 26, according to Finance Ministry data. Bessent has continued to signal support for a firmer yen, lending Japanese warnings more credibility with traders than in previous episodes of depreciation.
The latest comments suggest that Washington’s stance may be shifting from rhetorical support to more explicit coordination. With both governments now publicly aligned, the threshold for further yen weakness could prove more durable than in recent months, when intervention fears faded quickly after each round of official action.
Analysts said the combination of BOJ rate hikes and US concern over the currency could mark an inflection point. Still, the yen’s path will depend heavily on whether the Federal Reserve signals a pause or continues tightening, and whether Japanese authorities follow through with concrete action rather than verbal warnings alone.