The dollar was bought down to the low ¥153s for the first time in six months, driving the yen higher. Market activity intensified amid expectations that the Bank of Japan would accelerate the pace of rate hikes and following comments by U.S. Treasury Secretary Scott Bessent.
The yen strengthened in the Tokyo foreign exchange market on 8 September, briefly reaching the low ¥153s against the dollar. This was the yen's strongest level since mid-February of the previous year, as selling of dollars and buying of yen intensified.
Against this backdrop, market expectations grew that the Bank of Japan would accelerate the pace of rate hikes. Market participants believe that buying of the yen, whose interest rates are expected to rise, will continue.
One factor cited was that U.S. Treasury Secretary Scott Bessent met with Bank of Japan Governor Ueda Kazuo (植田 和男) at the end of August and was said to have conveyed his support for forceful measures to correct yen depreciation. At a 1 September press conference, he also spoke critically about reflationary policies in Japan. His remarks were interpreted as raising expectations of an early rate hike.