Japan Prime Minister Says Undervalued Yen Is ‘Problematic’ as Yen Jumps

The yen jumped about 1%, its strongest daily move in two weeks, after Finance Minister Satsuki Katayama said Japan’s leaders discussed the currency’s weakness with President Donald Trump.

Katayama said Prime Minister Sanae Takaichi told Trump that she considered an undervalued yen “problematic.” Katayama also said she and U.S. Treasury Secretary Scott Bessent would maintain close communication on foreign-exchange issues.

The move adds to pressure on Japanese policymakers after the yen neared 160 per dollar following a two-week decline. The currency had continued to weaken despite the Bank of Japan raising its policy rate to 1.25% on Sept. 18, the highest level in 31 years.

Japan and U.S. authorities jointly bought yen this summer for the first time since 1998 after the currency moved past 160 per dollar. Japan spent ¥15.4 trillion, or $97.4 billion, intervening through Aug. 26.

The latest comments put renewed focus on the possibility of closer coordination between Tokyo and Washington over foreign exchange. The yen’s broader direction will depend on whether official warnings are followed by policy action, further intervention or additional Bank of Japan rate increases.