Yen traders heads up – Japan finance minister Suzuki denies bilateral meeting with Yellen

Bank of Japan Governor Ueda and Japan finance minister Suzuki spoke over the weekend, at the conclusion of the G7 meeting in Italy.

Suzuki said he hadn’t had a one-on-one meeting with US Treasury Secretary Yellen. Which seems to indicate no discussion on co-ordinated yen intervention took place. Prior to the weekend Suzuki’s offsider, Vice MInister for International Affairs Masato Kanda (the official who will instruct the BOJ to intervene, when he judges it necessary) had basically said there was no need for a meeting.

Earlier this month Yellen was not encouraging of the idea:

A few days later there was more cold shoulder from Yellen:

Not to hammer this point too much but Yellen repeated the same just last week, that intervention should be rare and well-telegraphed in advance.

So, it was only a Suzuki and Ueda tag team show after the G7.

Suzuki:

• Reaffirmed the G-7 commitments on foreign exchange
• Said that many factors are making contributions to increase in yields
• Warned against maintaining rates above zero

And with rising rates in Japan he also

• called against maintaining rates above zero… “We must be acutely aware that the world of positive interest rates has come … we will make progress in restoring fiscal health with more sense of urgency than ever.”

Bank of Japan Governor Ueda seemed happy to let Suzuki handle the gnarly issues, shrugging it all off with:

• Long-term bond yields are determined by financial markets in principle
• Will monitor fixed interest markets

Ueda didn’t talk about the rate path ahead, nor did he specify much on the chances of trimming back on Japanese Government Bond bond purchases at the next policy meeting (this is in June).