JPY strengthens broadly as Bessent intervention impacts Asian FX markets

The Japanese yen has surged across all major pairs during Thursday's Asian session following US Treasury Secretary Bessent's call for BOJ rate hikes. USD/JPY led declines, dropping to 146.40, while cross-yen pairs also weakened significantly. The Nikkei 225 index fell sharply as yen appreciation pressured export-oriented stocks. Bessent's comments mark unusual US government intervention in Japanese monetary policy, suggesting Trump administration preference for a stronger yen to address trade imbalances. Asian FX markets showed mixed reactions, with risk-sensitive currencies underperforming amid the shift in sentiment. Technical indicators suggest further yen strength possible, with USD/JPY eyeing 145.00 support. The development raises questions about future US-Japan monetary policy coordination and potential BOJ response. Traders are repositioning for possible acceleration in BOJ policy normalization timeline.