The Japanese yen is not yet involved in the US-Japan trade negotiations, and the market is focusing on the meeting next week between the finance ministers of the two countries.

Despite the fact that the Japanese yen has temporarily avoided being dragged into the US-Japan tariff negotiations, it is likely to be brought up again in future negotiations, leading to greater fluctuation risks. Ryosei Akazawa, Japan's Chief Trade Negotiator and Minister of Economic Revitalization, stated on Thursday that he did not discuss exchange rate issues with US President Trump and other US officials. He added that this issue should be handled by Japan's Finance Minister Katsunobu Kato and US Treasury Secretary Scott Bessent. After Akazawa's remarks, the yen fell by 0.5% against the US dollar to 142.57 yen. It is worth noting that a meeting between Katsunobu Kato and Scott Bessent could potentially take place as early as next week during the International Monetary Fund (IMF) meetings. Any signs showing that the US is considering weakening the dollar could quickly push the yen to strengthen once again. Yusuke Matsuo, Senior Market Economist at Mizuho Securities, said, "The upcoming meeting between Katsunobu Kato and Scott Bessent could have a greater impact on the foreign exchange market. Today's trends could potentially reverse depending on the progress of the negotiations. Additionally, we should be prepared for a stronger yen." Yujiro Goto, Head of Foreign Exchange Strategy at Nomura Securities, stated, "After Akazawa's remarks, the yen weakened as traders unwound their long positions. However, the market still seems to be testing the USD/JPY rate falling to 140. He added that due to factors such as diminishing expectations of a rate cut by the Federal Reserve and ongoing uncertainty about the US economic outlook, the dollar continues to strengthen. Although both the US and Japanese governments agreed earlier that exchange rate issues would mainly be handled by Katsunobu Kato and Scott Bessent later on, the market still experienced volatility. The US has pressured Japan to support the yen against the dollar to boost US export competitiveness. In response to criticism from Trump accusing Japan of weakening its currency to gain a trade advantage, Ryosei Akazawa stated, "I don't remember Japan attempting to guide the yen depreciation or engage in similar operations."