Japan's Ministry of Finance: Currency intervention amounted to 0 yen from May 29 to June 26

Japan's Ministry of Finance: Currency intervention amounted to 0 yen from May 29 to June 26

In a significant development, the Ministry of Finance (MOF) of Japan has reported that the country's currency intervention amounted to 0 yen from May 29 to June 26. This period coincides with the ongoing trade negotiations and geopolitical shifts that have been influencing global currency markets.

The decision to refrain from currency intervention during this period was likely influenced by several factors. The Japanese yen has been under pressure due to a combination of factors, including the strengthening of the US dollar, improving global trade sentiment, and the fading expectations of imminent US rate cuts [1]. Additionally, the announcement of a preliminary trade deal with the UK and hints at further trade agreements by US President Donald Trump have bolstered the greenback's strength [1].

On the domestic front, while personal spending in Japan rose more than expected in March, offering a positive signal for consumption, a third consecutive monthly decline in real wages cast a shadow over the broader economic outlook [1]. These economic indicators may have influenced the MOF's decision to avoid currency intervention, focusing instead on other economic measures.

The USDJPY decreased 0.5755 or 0.39% to 145.3315 on Friday, May 9, from 145.9070 in the previous trading session. Historically, the USDJPY reached an all-time high of 358.44 in January of 1971 [1]. The Japanese yen is expected to trade at 146.83 by the end of this quarter, according to Trading Economics global macro models and analysts' expectations [1].

The MOF's decision to avoid currency intervention comes amidst broader regulatory developments in Japan's financial sector. The Financial Services Agency (FSA) has proposed reclassifying cryptocurrencies as financial products under the Financial Instruments and Exchange Act. This move aims to align Japan's financial system with its "New Capitalism" strategy and transform the country into a more investment-driven economy [2].

The reclassification would allow for the launch of crypto exchange-traded funds (ETFs) in Japan and reduce the capital gains tax on crypto from a rate of up to 55% to a flat 20%, putting it in line with taxation on stock investments [2]. The proposal is part of a broader effort to recognize digital assets as a legitimate component of the financial system and catch up with the progress made in leading economies like the United States.

The reappointment of Atsushi Mimura, Japan's top foreign exchange diplomat, for a second year underscores the country's commitment to its currency policy and economic coordination with other nations. Mimura's role is crucial in the ongoing trade negotiations with the United States and discussions on foreign exchange between Japan and the US Treasury [3].

References:

[1] https://tradingeconomics.com/japan/currency
[2] https://invezz.com/news/2025/06/24/japans-fsa-proposes-classifying-cryptocurrencies-as-financial-products/
[3] https://talkwinchester.com/japans-top-fx-diplomat-mimura-to-serve-in-post-for-second-year/