Japan-US Finance Minister Joint Statement – Kato Press Conference
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Japan, US, and South Korea issue Joint Statement on Currency Markets
Table of Contents
Published: September 12, 2025, 01:43:02
What Happened?
On September 12, 2025, the finance ministers of Japan, the United States, and South Korea issued a joint statement expressing “concerns” about recent volatility in currency markets. Japanese Finance Minister Shunichi Kato confirmed the statement, signaling a coordinated response to the weakening of the Japanese Yen and the South Korean Won as reported by iji Press via Yahoo! News.
The statement emphasized the importance of each country’s commitment to maintaining financial stability and reiterated their willingness to take appropriate action as needed. While not explicitly stating intervention, the language strongly suggests a willingness to intervene in foreign exchange markets to stabilize their currencies.
Why It Matters: Context and Implications
The joint statement is a significant progress, reflecting growing anxieties about the impact of currency depreciation on their respective economies. A weaker Yen and Won can boost exports,but also increase import costs,fueling inflation. Japan, in particular, is highly sensitive to currency fluctuations due to its reliance on imported energy and raw materials.
This coordinated response is notable because direct intervention in currency markets is a sensitive issue. It can be seen as a violation of the principle of allowing markets to operate freely. However, when currencies fall too rapidly, governments may feel compelled to act to prevent economic disruption.
Recent Currency Movements
The Japanese Yen has experienced substantial depreciation against the US dollar in recent months, reaching levels not seen in decades. Several factors have contributed to this decline, including the widening interest rate differential between the US Federal Reserve and the Bank of Japan (BOJ). The BOJ has maintained its ultra-loose monetary policy,while the Fed has been aggressively raising interest rates to combat inflation.
The South Korean Won has also come under pressure, influenced by global economic uncertainty and concerns about the country’s trade balance.
| Currency | Change vs. USD (YTD 2025) | As of Date |
|---|---|---|
| Japanese Yen | -18.5% | September 11, 2025 |
| South Korean Won | -12.2% | September 11, 2025 |
Source: Bloomberg, data as of September 11, 2025.
Previous Interventions
Japan has a history of intervening in foreign exchange markets to defend the Yen. In September 2022, Japan intervened in the currency market for the first time in 24 years, spending nearly 9.8 trillion yen ($62 billion) to prop up the currency. Reuters. The effectiveness of these interventions is ofen debated, as they can provide only temporary relief.
The US has generally been reluctant to intervene directly in currency markets, preferring to rely on market forces. However, the US Treasury has previously participated in coordinated interventions with other countries.