At around 10 a.m. on June 28 in Tokyo, the yen’s exchange rate fell to the 161-yen level per US dollar, marking its lowest point in 37 and a half years.

There is a growing view that the timing of interest rate cuts in the United States will be later than expected.

As a result, the interest rate gap between Japan and the U.S. is becoming more pronounced, leading to continued buying of the more advantageous dollar and selling of the yen.

The yen’s rate to the dollar has weakened by more than 5 yen this month alone, and by more than 20 yen since the beginning of the year.

This has led to soaring import prices, directly hitting households and significantly impacting the operation of small and medium-sized enterprises.

Against the backdrop of this development, Japanese Finance Minister Suzuki Shunichi expressed concerns at a press conference on June 28 over the impact of sudden and unilateral fluctuations in exchange rates. 

He said that the government is closely monitoring developments in the foreign exchange market with a high sense of urgency.