Key Facts
• Former Finance Official Toyoo Gyohten served as Japan’s Vice Minister of Finance in 1986.
• Gyohten highlighted concerns over low interest rates causing yen depreciation.
• He warned of potential inflation if the situation remains unaddressed.
• Gyohten suggested the Bank of Japan (BOJ) should consider raising interest rates.
• He noted that narrowing the Japan-U.S. interest rate gap could stabilize the yen.
• Current yen levels are historically weak, with room for appreciation.
• Gyohten emphasized changing perceptions of yen appreciation in Japan’s industries.
• Interview conducted on September 11, 2025, with detailed insights to be published on September 22.
Summary
Toyoo Gyohten, former Vice Minister of Finance and current honorary advisor at MUFG Bank, expressed concerns about Japan’s low interest rates leading to yen depreciation and potential inflation. In an interview, he urged the Bank of Japan to consider raising interest rates to address these issues. Gyohten explained that narrowing the interest rate gap between Japan and the U.S. could stabilize the yen, which he described as historically undervalued. He also noted a shift in industrial perspectives, with less resistance to yen appreciation compared to the past. The interview, conducted on September 11, 2025, will be part of a detailed feature on September 22, covering topics such as the Plaza Accord, U.S. currency policies, and the future of the U.S. dollar.
