Japan's finance minister wants to discuss forex with Bessent at G7

By Makiko Yamazaki

Japanese Finance Minister Katsunobu Kato said on Tuesday that he would seek to meet U.S. Treasury Secretary Scott Bessent on the sidelines of the G7 meetings in Canada next week to discuss foreign exchange.

"I'm making preparations to attend the meetings of G7 finance leaders in Canada next week," Kato told a regular press conference, referring to the May 20-22 meetings of finance ministers and central bank governors from the Group of Seven economic powers.

"If circumstances allow, I'd like to use this opportunity to have a meeting with Treasury Secretary Scott Bessent and continue to discuss foreign exchange," he said.

Japan and the United States have agreed to keep the thorny issue of currency rates separate from direct trade negotiations, setting aside the issues for talks between their finance ministers.

At Tuesday's press conference, Kato said if the meeting with Bessent goes ahead, they could naturally discuss foreign exchange as part of Japan's tariff negotiations with the United States.

Kato and Bessent last met on April 24 in Washington, where they agreed to continue "constructive" dialogue on currency policy, but did not discuss setting currency targets or a framework to control yen moves.

U.S. President Donald Trump's focus on addressing the trade deficit and his past criticisms of Japan's weak yen have heightened market concerns that Tokyo will face pressure to strengthen the yen against the dollar.

The dollar surged on Monday as the United States and China reached a deal to temporarily cut reciprocal tariffs, easing immediate concerns that a trade war between the world's two biggest economies could lead to a global recession.

The risk-on mood weighed on safe-haven currencies such as the yen, with the dollar briefly hitting 148.64 yen, its highest since April 3.

Asked about the U.S.-China deal, Kato said the government will closely monitor related developments, examine the impact thoroughly and act appropriately, while declining to comment on currency developments.