Bessent, Japan Reaffirm FX Coordination as Tokyo Buys Yen

U.S. Treasury Secretary Scott Bessent met Japan Finance Minister Satsuki Katayama in Tokyo on May 12 to reaffirm US-Japan coordination on foreign exchange. Officials described their communications as constant and robust. The meeting was part of Bessent’s wider Asia tour.

The talks focused on the yen after it weakened sharply against the dollar. Tokyo is believed to have bought about $60 billion of yen in late April 2026 as the currency approached 155 per dollar. Japan’s cumulative interventions since 2022 have exceeded $100 billion. Since September 2025, joint statements from the two governments have allowed interventions to counter what they call excessive market swings.

In the minutes after the meeting the USD/JPY rate fell roughly 0.8% to about 152.3. The finance ministry has used large yen purchases to support the currency when markets move rapidly.

Traders point to the wide interest-rate gap between Japan and other economies as a driver of yen weakness. The yen is commonly used as a funding currency for carry trades: investors borrow in low-yielding yen, convert to higher-yielding currencies and invest in assets such as bonds, equities or cryptocurrencies. When yen volatility spikes or the government intervenes to strengthen the currency, those trades can unwind quickly and trigger asset sell-offs.

Cryptocurrency markets have reacted to these flows. Bitcoin held above $95,000 after the Tokyo meeting. Market analysts noted that lower forex volatility can redirect capital toward fixed income, while renewed yen weakness has in the past contributed to rapid moves across asset classes.

Bessent’s Asia tour includes planned talks with Chinese officials. China’s foreign exchange policies and capital controls have historically influenced cross-border flows and demand for alternative stores of value.