US Treasury Secretary Scott Bessent said on Sunday that recent declines in the Japanese yen remain "pretty well contained," pushing back on suggestions that the currency's renewed weakness resembles the disorderly moves that prompted a rare joint US-Japan intervention last month.

In an interview with Reuters, Bessent said he sees no need to characterise the yen's current trajectory as disorderly — a marked contrast to the language both governments used in August, when the currency touched its weakest level against the dollar since 1986.

That earlier episode saw Japan and the United States carry out their first coordinated currency intervention since 1998. The two countries bought yen after it slid to roughly 163.73 per dollar, and the currency rebounded following the announcement. Japanese officials said at the time that the operation targeted excessive volatility, while Bessent had said a stable yen mattered not only for the US but for the wider region. The yen's persistent weakness has its roots in the wide interest-rate gap between the Federal Reserve and the Bank of Japan, which has kept Japanese rates ultra-low even as other major central banks held policy restrictive, making the dollar more attractive to yield-seeking investors.

By describing the yen's recent slide as well contained, Bessent has lowered the near-term odds of a repeat of that joint action. His latest comments suggest Washington does not currently see conditions warranting further intervention, since he has signalled the Treasury sees no need for fresh yen intervention.

On the question of Japanese monetary policy, Bessent said he expects Bank of Japan Governor Kazuo Ueda to do the right thing, with the backing of Prime Minister Sanae Takaichi. He declined to say whether the central bank should consider consecutive interest rate hikes to support the currency, saying he "won't tell the central bank what to do." By deferring to Ueda's judgment rather than pushing the BOJ toward back-to-back hikes, Bessent leaves the pace of Japanese tightening squarely in Tokyo's hands — a stance consistent with long-standing US practice of avoiding public pressure on independent central banks.

Bessent praised Ueda as a highly capable and underrated, savvy market operator whom he has known for 15 years. The two plan to meet on the sidelines of the G20 finance leaders' gathering, which opens Monday in Asheville, North Carolina.

Bessent also offered a broader assessment of Japanese economic policy, saying the country has probably reached the end of Abenomics, the reflationary program associated with former prime minister Shinzo Abe. With reduced government intervention in economic policy under PM Takaichi, he suggested Japan should let the gains already achieved under that program continue to play out rather than pursue further active stimulus. Together with his praise for reduced government intervention under the current administration, this signals continued US comfort with Tokyo's gradual policy normalisation rather than a push for faster yen support.

The remarks come as markets watch for any signal from the G20 meeting on how Washington and Tokyo intend to coordinate on currency and monetary policy in the months ahead. Related analysis: Yen strength still hinges on BOJ hike, not capital repatriation (or intervention!), Goldman says

With no fresh intervention signalled and the BOJ left to set its own pace, USD/JPY is likely to remain sensitive to incoming Japanese data and rhetoric from the G20 gathering rather than to any new US pressure.