US Treasury’s Bessent: Japanese government gives BoJ policy space, avoid excess FX volatility

US Treasury Secretary Scott Bessent said on Wednesday that the government’s willingness to allow the Bank of Japan (BoJ) policy space will be key to anchoring inflation expectations and avoiding excess foreign exchange (FX) volatility.

Key quotes

Government’s willingness to allow BoJ policy space will be key to anchoring inflation expectations, avoiding excess FX volatility.
Encouraged by Japan Finance Minister’s deep understanding of how Abenomics has moved away from purely reflationary policy to program that must balance growth, inflationary concerns.

Market reaction

At the time of writing, the USD/JPY pair is trading 0.34% lower on the day to trade at 151.60.