By Makiko Yamazaki and Leika Kihara
TOKYO, Jan 29 (Reuters) – Japan’s top monetary officials are taking advantage of rare U.S. support in their fight against the weak yen, using tactical silence and calibrated communication to steer the currency sharply higher without resorting to large-scale intervention.
At the heart of the approach is Atsushi Mimura, Japan’s top currency diplomat, whose sparse public remarks have become political signals in their own right.
Instead of offering frequent color on the currency, Mimura has maintained deliberate tone changes, according to sources familiar with his thinking, a communication style that has most recently kept speculators wondering when, or if, Tokyo might enter.
“They pushed the dollar/yen down by roughly seven yen while preserving their firepower,” said Shota Ryu, FX strategist at Mitsubishi UFJ Morgan Stanley Securities. “It’s a remarkably efficient approach.”
The yen’s gains have occurred on three occasions since late last week, with the sharpest moves following unusual rate control reports from the New York Federal Reserve that put investors on alert for the first joint US-Japan intervention in 15 years.
While US Treasury Secretary Scott Bessent denied that the US was intervening in currency markets to support the yen, former Japanese monetary officials said US participation in rate controls is a major advance for Japan, as Washington has traditionally viewed currency intervention negatively.
His involvement, even at the level of rate controls, has reinforced the perception that the two governments are aligned to arrest the decline of the yen, they said.
Tokyo remained deliberately quiet on the daily market swings, repeating only that it is in close coordination with the US authorities.
“By keeping silent, they make the market think they must be doing something behind the scenes. Their silence is fueling speculation and increasing uncertainty,” said Yuji Saito, executive consultant at SBI FX Trade.
Mimura, who became vice finance minister for international affairs in 2024 after spending nearly a third of his 37-year government career with Japan’s banking regulator, previously described his approach as deliberate.
“Being always vocal is one style of communication, but not speaking can also be another way,” he told Reuters when he started the current post, which oversees Japan’s currency policy and coordinates economic policy with other countries.
That approach can be powerful precisely because it does not require money for costly currency interventions. Bank of Japan money market data show no clear signs that Japan has intervened since Friday’s yen rally, at least not on the scale of operations in 2022 and 2024, when Japan spent 24.5 trillion yen ($160.19 billion) in total.