By David Lawder
PARIS, May 19 (Reuters) – U.S. Treasury Secretary Scott Bessent said on Tuesday he was confident that Bank of Japan Governor Kazuo Ueda would do “what he needs to do” if granted sufficient independence by Japan’s government, signalling Washington’s desire for further rate hikes by the central bank.
“I think he’s an excellent central banker, and if they will give him the room to do what he will do, needs to do, I am confident that they will have great monetary policy,” Bessent told Reuters in an exclusive interview.
The remarks reaffirm Bessent’s long-standing confidence in Ueda while signalling that the success of Japan’s monetary strategy will hinge in part on Prime Minister Sanae Takaichi’s administration allowing the central bank freedom over interest rate decisions.
It also suggests that Washington is nudging Japan on the need to allow for policy tightening as needed, particularly given Takaichi’s long-standing preference for loose monetary policy and her past resistance to BOJ tightening.
In a post on X on Tuesday, Bessent said he had met Ueda on the sidelines of a Group of Seven finance chiefs’ meeting in Paris to discuss Japan’s economy and market outlook, adding: “I am confident that Governor Ueda will successfully guide Japan’s monetary policy.”
Bessent met Takaichi and Finance Minister Satsuki Katayama during a visit to Tokyo earlier this month.
Bessent and Katayama said separately that they had reaffirmed close coordination on exchange-rate developments, though they offered few details on their discussions related to monetary policy.
The BOJ kept interest rates steady last month, but dropped strong signals about the chance of a hike as soon as June due to growing concern that higher energy costs resulting from the Middle East war could push up inflation.
(Reporting by David Lawder and Makiko Yamazaki, Editing by Alexandra Hudson and Gareth Jones)
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