Bessent, a veteran currency strategist, told investors that the Japanese yen will likely stabilize once the Bank of Japan (BOJ) adopts a “proper” policy that balances the economy and markets.
In a recent interview, Bessent emphasized that if the BOJ moves away from its ultra‑loose stance—cutting rates again or buying bonds—toward a more measured approach, the yen should find a logical level relative to the U.S. dollar and other major currencies. The specialist noted that the Japanese authorities have a long history of stepping in to prevent sharp swings, but they must also signal a clearer commitment to future policy moves to restore market confidence.
The yen has weakened to a new low in recent weeks, pushing the currency to the 161‑per‑USD mark. That decline has rattled exporters and amplified worries about inflation. Yet Bessent argues that the market’s reaction has stretched too far. With the BOJ’s next policy meeting looming, analysts are watching closely for any shift away from decades of stimulus.
“Currency markets thrive on predictability,” Bessent said. “If the BOJ tells the world it will not pursue more stimulus while also preventing runaway inflation, traders will stop chasing the yen to the extremes.”
Investors should watch the policy announcements for clear guidance, as it will shape the direction of the yen. The news feeds into a broader debate about how central banks can manage recovery while curbing inflation, and how the yen’s future will influence global trade.
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