Japan’s finance minister reaffirmed that Tokyo is working closely with the U.S. to ensure stability in the foreign-exchange market, as expectations of hawkish shifts on both sides spur yen volatility.

"Generally speaking, we view the yen’s undervaluation as problematic," Finance Minister Satsuki Katayama said at a news conference Tuesday. "We remain committed to maintaining order in the currency market."

She added that she agreed in a recent call with U.S. Treasury Secretary Scott Bessent to strengthen cooperation in the currency market, saying that "reconfirming this stance at this time holds great significance."

The yen was little moved by the latest comments, trading at 157.28 to the dollar. Over the past few weeks, the yen has seesawed as markets increasingly price in the possibility of faster interest-rate hikes by the Bank of Japan to combat persistent inflation. On the other hand, concerns over Prime Minister Sanae Takaichi’s expansive fiscal policies, as well as a wide rate differential with the U.S., continued to exert some pressure on the currency.