Japan's Katayama says all options open on yen, including joint action with US

By Makiko Yamazaki

TOKYO, Jan 16 (Reuters) - Japanese Finance Minister Satsuki Katayama said on Friday Tokyo would not rule out any options to counter excessive foreign exchange volatility, including coordinated intervention with the U.S., as the yen stayed around an 18-month low against the dollar.

The yen weakened to as low as 159.45 per dollar this week, its softest level since Japan last intervened in July 2024, heightening speculation that Tokyo may soon step in.

"As I have stated repeatedly, we would take decisive action without excluding any options," Katayama said at a regular press conference.

She also said she shared the view with U.S. Treasury Secretary Scott Bessent that recent currency moves have been excessive when they met in Washington on Monday.

Asked whether joint intervention with the United States would be a realistic option, Katayama said a Japan-U.S. joint statement last September "was extremely significant and included language on intervention."

"It does not specify whether such intervention would be coordinated or not, so we consider that no options are excluded," she said.

The yen's weakness has been exacerbated by expectations that an election win by Prime Minister Sanae Takaichi would allow her to secure a strong mandate for her expansionary fiscal policy.

The weak yen has been a headache for policymakers as it inflates import costs and pushes up the cost of living for households. It could also affect Takaichi's popularity ratings.

Katayama's comments followed a statement by the U.S. Treasury Department that Bessent emphasised the need for sound formulation and communication of monetary policy in his meeting with her and noted "the inherent undesirability of excess exchange rate volatility."

Katayama said at the press conference that the statement probably reflected Bessent's longstanding personal view, as he has for some years argued that Japan's monetary policy had been behind the curve, dating back to long before Takaichi's administration took office.

"But this is only my assumption, so I would stress that point," she added.