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    Reports suggest that Japan’s trade negotiator Akazawa is canceling his visit to the US.

    by VT Markets
    /
    Aug 28, 2025
    Japan’s chief trade negotiator, Akazawa, may cancel his trip to the United States, according to Kyodo News. He was scheduled to discuss Japanese investment plans in the US. The current USD/JPY exchange rate has slightly risen from recent lows, now sitting at around 147.45.

    Cancellation Of High-Level Meeting

    The cancellation of this important meeting brings uncertainty to US-Japan economic talks. It could create tension that affects the expected flow of capital. For traders in derivatives, we should expect an increase in implied volatility for USD/JPY options in the next few weeks. With the exchange rate near 147.50, we may see currency intervention becoming a real possibility. Recall the rapid gains in the yen after the Ministry of Finance intervened in late 2022 and again in 2024 when similar levels were reached. This makes purchasing JPY call options, or USD/JPY put options, a more appealing strategy to protect against a sudden downturn. This development comes as Japan reported its latest core CPI data at 2.3%, stubbornly above the Bank of Japan’s 2% target. On the other hand, recent jobs data from the US showed a slight slowdown, which strengthens market views that the Federal Reserve will keep rates steady. The narrowing gap between the two central banks’ policies is already creating challenges for the dollar against the yen.

    Impact On Japanese Investment

    A key focus of the cancelled talks was Japanese investment, with Japanese funds holding over $1.2 trillion in US Treasury securities. Any delays or disruptions to future investment plans could lessen demand for the US dollar. This indicates that, even without direct intervention, the likely direction for USD/JPY may be downward. Create your live VT Markets account and start trading now.

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