A cheaper yen can make a trip to Japan more affordable for overseas visitors. For households earning yen and businesses buying imports, the same exchange rate can squeeze spending power. A September 25 call between Japanese Finance Minister Satsuki Katayama and U.S. Treasury Secretary Scott Bessent brought that tension back into focus.
From a leaders’ meeting to a finance-minister call
Japan disclosed on September 25 that President Donald Trump had raised concerns about yen weakness with Prime Minister Sanae Takaichi in New York on September 22. Takaichi said the U.S. side had cited difficulties for American trade. She agreed that an undervalued yen was problematic in principle, while saying the meeting had not discussed monetary or fiscal policy. Reuters.
Later on September 25, Japan’s Finance Ministry said Katayama and Bessent had reaffirmed their concern about the yen’s undervaluation during a call. They also discussed financial-market developments. The statement alone is not evidence that a new round of currency intervention took place. TV Asahi report carried by KAB.
The same dollar bill costs more yen
Consider a hypothetical import priced at $100. At ¥140 to the dollar, it costs ¥14,000; at ¥160, it costs ¥16,000. Those are illustrative exchange rates, not quotes from the latest trading session. The calculation also leaves out freight and taxes.
An importer can absorb the extra cost or try to pass it on to customers. Bank of Japan research examines how exchange-rate changes feed into consumer prices through import costs, with the extent of the effect shaped by factors including import penetration and firms’ pricing. A percentage fall in the yen therefore cannot simply be treated as the same percentage rise in grocery or electricity bills. Bank of Japan research.
Asia’s buyers and competitors face different effects
The economic mechanism works differently for exporters. A Japanese seller holding its yen price steady may become cheaper to a foreign buyer. But imported inputs can become more expensive for that same seller, offsetting part of the advantage. Contracts, invoicing currencies and pricing decisions determine how much reaches the customer.
For other Asian exporters, that can mean stronger price competition from Japanese rivals. A company buying Japanese machinery could experience a different effect. These are possible transmission channels, not evidence that every Asian business has gained or lost from the latest currency moves.
The next developments to watch are concrete policy measures, import-price data and changes in households’ purchasing power. Official statements can influence expectations, but they do not guarantee that the yen will strengthen. For families, the practical question remains whether incomes keep pace with living costs.