BOJ Governor Ueda signals September rate hike, markets in turmoil as yen surges and stocks fall

BOJ Governor Ueda strongly hints at September rate hike; U.S. Treasury Secretary also demands decisive measures At a press conference after attending the G20, he said he would conduct policy with an emphasis on upside risks to prices, and suggested discussions on a rate hike at the September 17-18 meeting. U.S. Treasury Secretary Bessent supported 'decisive measures' to correct the yen's weakness, and expectations of a rate hike strengthened, with the 2-year government bond yield rising to 1.83%, the highest since 1995. 1234

Yen surges to 158 yen level at one point, vigilance over additional intervention intensifies In the foreign exchange market on the 2nd, the yen rose 1.2% against the dollar and was bought up to 158.22 yen. The background includes hawkish remarks by BOJ board member Takata and speculation of official intervention, and data showing that the Ministry of Finance conducted yen-buying intervention of $96.4 billion over the past month has also heightened caution. 56

Nikkei falls 1,889 points, breaks below 65,000 in triple decline of weak yen, falling bonds, and falling stocks Rising oil prices due to worsening Middle East situation and long-term interest rates exceeding 3% for the first time in 30 years weighed on the market, leading to a broad decline on the Tokyo Stock Exchange. The decline temporarily exceeded 1,900 points, and the closing price was 64,325.64 yen, down 1,889.70 yen, falling below the 65,000 level for the first time in about a month. 78910

Finance Minister Katayama says no objections to Japan-U.S. coordinated intervention at G20 At a press conference after the G20 finance ministers and central bank governors meeting, he explained to countries the Japan-U.S. coordinated yen-buying intervention conducted on July 31 and revealed that there were no objections. U.S. Treasury Secretary Bessent called on Japan to change policy, saying it 'should end its reflation policy.' 411

Kioxia requests government support; massive public-private investment for semiconductor revival The president of Kioxia Holdings met with Prime Minister Takaichi on August 27 and requested government support to accelerate investment to meet demand for generative AI. The government and local governments plan to support the rebuilding of domestic production capacity through subsidies and tax incentives, and a policy shift positioning semiconductors as a strategic industry is progressing. 12

SK Hynix considers joint production with Kioxia; condition for maintaining stake The SK Group chairman mentioned the possibility of selling Kioxia shares if manufacturing cooperation is not realized, while revealing that joint production is being considered. In response to the rapid increase in AI memory demand, the company is also investigating locations for memory factories in Japan. 13