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Takaichi Denies Responsibility for Yen Weakness and Yields

Prime Minister Sanae Takaichi said she is not responsible for the yen’s decline or the rise in Japanese government bond yields. She made the remarks in a parliamentary session after opposition lawmaker Yoshifumi Hamano questioned her about a second supplementary budget. Takaichi said that a strong economy will restore confidence in the yen and that her administration will manage the size of new bond issuance. Japanese yields have climbed to multi‑decade highs while the yen fell to its lowest level since 1986, prompting intervention by Tokyo and Washington. She noted that a weaker yen can benefit exporters by making Japanese goods cheaper abroad, but she has no preference for the currency’s direction. The government plans to keep the total bond issuance for 2026 unchanged from the original budget, despite concerns from market experts. The central bank has raised its policy rate and is normalising monetary policy, contributing to the yield rise. Takaichi’s comments come as Japan considers cutting food tax and managing fiscal spending amid a challenging global economic backdrop.

· CNBC

The essential points

  1. 01Takaichi denies blame for yen weakness and rising bond yields amid parliamentary questioning
  2. 02She argues a stronger economy will boost yen confidence and that bond issuance will be carefully controlled
  3. 03Japanese yields hit multi‑decade highs while the yen fell to its lowest level since 1986, prompting market intervention
  4. 04The government plans to keep 2026 bond issuance unchanged from the original budget despite expert skepticism
The full brief

Prime Minister Sanae Takaichi said she is not responsible for the yen’s decline or the rise in Japanese government bond yields. She made the remarks in a parliamentary session after opposition lawmaker Yoshifumi Hamano questioned her about a second supplementary budget. Takaichi said that a strong economy will restore confidence in the yen and that her administration will manage the size of new bond issuance.

Japanese yields have climbed to multi‑decade highs while the yen fell to its lowest level since 1986, prompting intervention by Tokyo and Washington. She noted that a weaker yen can benefit exporters by making Japanese goods cheaper abroad, but she has no preference for the currency’s direction. The government plans to keep the total bond issuance for 2026 unchanged from the original budget, despite concerns from market experts.

The central bank has raised its policy rate and is normalising monetary policy, contributing to the yield rise. Takaichi’s comments come as Japan considers cutting food tax and managing fiscal spending amid a challenging global economic backdrop.