Bessent: Trusts BOJ Governor Ueda to Make the Best Decisions
Miles Bennett
U.S. Treasury Secretary Bessent publicly backed BOJ Governor Ueda's judgment, predicting Japan's inflation will ease as energy prices fall and the yen's excessive weakness corrects — leading to a "virtuous cycle" for the economy and currency.
What exactly did Bessent say?
In an interview with Japan's NHK, Bessent said he trusts Governor Ueda to "make the best decisions" for the Japanese economy.
This means → The U.S. Treasury has no public objection to the BOJ's current monetary-policy path — the message is "your call."
The backdrop: the yen has been weakening steadily, and markets have wondered whether Washington would pressure Tokyo. Bessent's statement amounts to a public endorsement of Ueda.
Why has Japan's inflation risen?
Bessent pointed to two drivers: yen depreciation and higher energy prices.
In plain terms = a weaker yen makes imports costlier; rising oil prices push up living costs — the two forces stacked together have lifted headline inflation.
The key point: both are imported, supply-side pressures, not a sign of overheating domestic demand — and that distinction shapes the outlook.
What is the "virtuous cycle" Bessent expects?
Bessent argued that as energy prices retreat and the yen's excessive depreciation corrects, Japan's inflation will moderate.
This means → he views the current inflation pressure as transitory — no need for aggressive central-bank action.
Put simply = once oil comes down and the yen stabilizes, prices settle on their own, and the economy and currency begin reinforcing each other positively — that is his "virtuous cycle."
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