Japan's finance minister, BOJ chief to attend G20 gathering next week

Tokyo: Japan's finance minister and central bank governor will attend ​next week's U.S.-hosted meeting of finance ​chiefs from the Group of 20 major economies, setting the stage for ​renewed debate over policies to reverse a stubbornly weak yen.

Policymakers from G20 economies gathering in the city of Asheville, North Carolina are set to debate the global economic fallout from the Middle East war, U.S. calls for fresh ‌sanctions against ⁠Iran and ⁠the thorny topic of global imbalances.

Japanese Finance Minister Satsuki Katayama said on Friday she hoped to contribute to discussions about the global economy at the meeting, which the Bank of Japan said Governor Kazuo Ueda would also attend - potentially allowing him to meet U.S. Treasury Secretary Scott Bessent.

BESSENT MEETINGS IN FOCUS

Financial markets are focusing on whether Katayama and Ueda will meet Bessent on the sidelines of the G20 gathering, after the coordinated Japan-U.S. currency intervention last month to prop up the ⁠sagging yen.

While ‌the yen is off the 40-year low near 164 per dollar hit ​last month, it ​has slipped back towards 160 after a jump to 155.20 shortly after ⁠the announcement of the joint action. It stood at 159.60 per ​dollar on Friday.

"The statement with Secretary Bessent on joint intervention was ​a very strong one and still lives," Katayama told a news conference on Friday, when asked about the stubbornly weak yen.

She also said the administration's efforts to boost investment and strengthen Japan's growth potential will help enhance the yen's credibility by boosting its competitiveness.

Bessent had said he was looking forward to meeting Ueda in Asheville, while also giving a nudge for the central bank ‌to raise interest rates as part of Japan's efforts to arrest yen declines.

Bessent's public views on Japan's monetary policy, as well as a recent slew of ​hawkish comments from ​the BOJ, have led markets ⁠to price in an 80% to 90% chance of a rate hike at its next meeting in September.

While refraining from committing to a hike, BOJ Deputy Governor Ryozo Himino stressed on Thursday ​the need for timely rate hikes and did not push back against dominant market bets of a rate increase next month.

"We will examine, including at the next policy meeting, the likelihood of our baseline scenario materialising as well as risks," Himino told reporters, adding that discussions will take into account the fact underlying inflation was approaching 2%.