By Leika Kihara
WASHINGTON (Reuters) – Japanese Finance Minister Katsunobu Kato and U.S. Treasury Secretary Janet Yellen discussed recent exchange rate movements, among other things, during a bilateral meeting on Thursday, a senior Japanese Finance Ministry official said.
“The two sides discussed exchange rate movements and reaffirmed the need for close communication between the United States and Japan,” Atsushi Mimura, Japan’s Vice Finance Minister for International Affairs, told reporters.
A weak yen has become a concern for Japanese policymakers as it penalizes households and retailers by raising the cost of importing raw materials.
“We have recently seen one-sided, sharp movements in exchange rates,” said Mimura, who oversees Japan’s currency policy.
“It is desirable that exchange rates move in a way that reflects fundamentals. We will be increasingly vigilant about currency movements, including those resulting from speculation,” he said in Washington on the sidelines of the G20 and IMF meetings.
The dollar climbed above 153 yen for the first time in almost three months on Wednesday, as declining expectations of major interest rate cuts by the Federal Reserve drew renewed attention to the wide interest rate differential between the US and Japan.
The dollar stood at 151.83 yen on Thursday.
