US inflation heats up, impacting the yen; Japan's Finance Minister again warns speculators: will not hesitate to intervene in exchange rates if necessary

According to Zhihu Finance APP, Japanese Finance Minister Kaori Katayama issued a warning to market speculators, stating that Japan is prepared to intervene in the foreign exchange market again if necessary. Previously, the latest U.S. inflation data came in higher than expected, pushing the yen to a stage low against the U.S. dollar this month.

She also indicated that since Japan and the U.S. jointly took action to support the yen in July this year, Tokyo and Washington’s position on the exchange rate issue has not changed.

Speaking to reporters on Thursday morning in Bangkok ahead of the G20 meeting, Kaori Katayama said: “Our position on foreign exchange issues is fully aligned with the signals sent when the two countries carried out joint intervention. The U.S. side is currently aligned with us, and we will not hesitate to take action if necessary.”

Katayama’s remarks come as the U.S. reported CPI data on Wednesday showing the highest inflation level in five months, causing the yen to depreciate further. On that day, the yen rate fell to 158.95 yen per U.S. dollar before narrowing its losses as U.S. Treasury yields retreated.

During this visit, Kaori Katayama will attend a series of international finance meetings. Finance ministers and central bank governors from participating countries are expected to discuss multiple global issues, including the rise in global bond yields and financial risks brought by frontier artificial intelligence (AI).

Discussing the recent surge in global bond yields, Katayama pointed out that among major developed economies, Japan is one of the few countries that can convincingly argue for fiscal sustainability. She emphasized that Prime Minister Sanae Takaichi and her cabinet have repeatedly made clear commitments to steadily reduce the debt-to-GDP ratio and keep government bond issuance within a reasonable range.

“Not all countries can make such clear commitments as we do,” Katayama stated. “We can confidently articulate our fiscal responsibility, and I also hope to firmly convey this message.”