US Treasury Secretary Bessent waffling on about the yen and BoJ
EUR/USD — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
Bank of America | Bearish | 1.1200 |
ANZ | Bearish | 1.1400 |
UOB | Bullish | 1.1565 |
From the original
US Treasury Secretary Bessent: Uptick in Japan’s inflation was result of weak yen, energy prices As energy prices come down and we no longer have excess yen weakness, that will contribute to inflation coming down and Japan, yen can go into a virtuous cycle I am sure BOJ Governor
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4 itemsBessent heads to Tokyo pressing Japan on yen weakness and intervention
Lead — The desk interprets US Treasury Secretary Bessent's recent visit to Tokyo as a pivotal moment in the ongoing debate over Japan's monetary policy and currency management. Bessent's preference for Bank of Japan (BOJ) rate hikes over yen intervention highlights the growing concern regarding the impact of Japanese financial flows on US Treasury yields. Per the full note [source], Bessent's advocacy for rate hikes comes amid speculation of a potential BOJ tightening as early as next month, which could significantly influence market dynamics. The desk notes that the current consensus target for USD/JPY reflects a cautious stance amidst these developments.
Bessent to raise weak yen with Japanese officials in Tokyo meetings next week
Lead — The upcoming visit of U.S. Treasury Secretary Scott Bessent to Japan underscores a pivotal moment in U.S.-Japan relations, particularly concerning the weak yen. Per the full note [source], discussions will not only focus on currency dynamics but also encompass broader economic security issues, including rare earths and energy procurement. This multifaceted agenda reflects a strategic shift in U.S. engagement with Japan, particularly as the yen faces ongoing depreciation pressures. The potential for coordinated currency discussions could reshape market positioning significantly, especially for yen shorts.