Japan and US finance ministers will discuss exchange rates at the G20. The yen-buying intervention at the end of July was among the largest on record, and its impact and the outlook for exchange rates are expected to be on the agenda.
Japan and US finance ministers plan to meet on the sidelines of the G20 Meeting of Finance Ministers and Central Bank Governors in North Carolina in the southern United States, where they will discuss the impact of the coordinated yen-buying intervention carried out by Japan and the US at the end of July, as well as the outlook for the yen. Global long-term interest-rate trends are also expected to be on the agenda.
According to the Ministry of Finance, total yen-buying, dollar-selling intervention conducted by the government and the Bank of Japan from 30 July to 26 August reached ¥15.3993 trillion, the largest monthly amount on record. The first intervention took place on 30 July, followed by coordinated yen buying by Japan and the US on 31 July.
After the intervention, the yen temporarily fell to the ¥163-per-dollar range, but was subsequently pushed back toward yen depreciation and was trading in the ¥159 range on the 28th. While the market remains firmly alert to the possibility of further intervention, the focus is on whether the Bank of Japan will raise interest rates further at its Monetary Policy Meeting.
Japan’s and the US’s top financial officials are also expected to share information on long-term interest-rate trends. The US indicated in August that it plans to increase the ceiling on purchases of long-term government bonds. The G20 meeting’s coordinated response to the impact of prolonged uncertainty surrounding the situation in the Middle East on the global economy will also draw attention.