Finance Minister Katayama Warns of Action as Yen Tests 160 Level
The US dollar held near a 19-month high on Friday, tracking toward its strongest weekly gain in two months as hotter US inflation lifted Federal Reserve rate-hike wagers. The dollar index stood around 103.17. Overnight in New York trading, the Japanese yen weakened past the 160-per-dollar threshold for the first time since early September. Japanese Finance Minister Satsuki Katayama issued an immediate verbal warning on Friday. Intervention risk returned to Tokyo.
USD/JPY traded between 159.86 and 160.03 in Asian hours, putting the yen on pace for a 0.9 percent weekly loss. Speaking to reporters Friday, Katayama pledged close cooperation with Washington and warned Tokyo would respond appropriately to excessive currency volatility. Katayama stated: "We have recently seen sharp, one-sided movements in the foreign exchange market." Even though the Bank of Japan signaled in late October that it could raise interest rates in December, widening US yield advantages overwhelmed yen support and fueled renewed carry-trade pressure. Tokyo previously spent a record 15.4 trillion yen, roughly $96.47 billion, during July and August 2026 to defend its currency after the yen slid to a four-decade low of 163.99 per dollar.
A Federal Reserve Bank of New York report released Thursday revealed that the first coordinated US-Japan currency intervention in nearly 30 years was far smaller on the American side than previously assumed. Although Treasury Secretary Scott Bessent had signaled potential US involvement up to $10 billion, Thursday's disclosure showed US authorities sold euros to buy roughly $497 million worth of yen. Fukuoka Financial Group strategist and former Bank of Japan official Tohru Sasaki noted: "There have been several cases of joint intervention, but the US has never put up that much money. People have been concerned that joint intervention could be very powerful, but this shows that it is not necessarily the case."
