Japan's Finance Minister Speaks Out on Currency Chaos

Japan's finance chief, Satsuki Katayama, has raised concerns about the yen's wild ride in the currency markets. She warned that Japan might step in if things get too crazy. This comes after the yen took a nosedive, even though the Bank of Japan had just raised interest rates. Katayama was talking to her G7 counterparts online when she shared her worries. She said the yen's sharp drop was alarming and hinted that Japan might take action, especially if speculators were driving the chaos. This isn't just idle talk; it's backed by a U. S. -Japan agreement that allows interventions to calm excessive market volatility.The dollar was up nearly 1. 2% against the yen, hitting around 157. 38 yen. This was the biggest one-day jump since early October. The yen did dip a bit after Katayama's warning, but the damage was already done. Some traders are betting that Japan will draw the line at 160 yen. That's the level where Japan last intervened in the currency market, back in July 2024, when the yen hit a 38-year low. When asked about the Bank of Japan's rate hike, Katayama said it was based on wage and price trends. The goal is to hit a 2% inflation target in a sustainable way. She also mentioned that she expects the Bank of Japan to keep working closely with the government to achieve this target.