Japan's finance minister stated on Monday that Tokyo and Washington have reached a shared understanding on maintaining orderly movements in the yen, while also dismissing media reports suggesting that U.S. Treasury Secretary has been pushing the Bank of Japan toward an interest rate hike.

Speaking on the sidelines of the G20 finance ministers' meeting in Asheville, North Carolina, Japanese Finance Minister Katsunobu Kato said: "Secretary and I both confirmed that orderly yen fluctuations are crucial for maintaining stability in global financial markets, including the U.S. market. Continued coordinated efforts between Japan and the United States will help achieve this shared objective."

However, Kato also clarified that she did not discuss Japanese monetary policy with him, contrary to what has been reported in the media.

According to a recent report from Japan's public broadcaster NHK, the U.S. Treasury Secretary met with both Finance Minister Kato and Bank of Japan Governor Kazuo Ueda during the G20 gathering in North Carolina. In that meeting, he reportedly made clear that Japan's next step should be to raise interest rates. The report, citing U.S. Treasury Under Secretary for International Affairs Erin Browne, indicated that the Treasury Secretary emphasized the need for Japan to send a clear signal to the markets that it is removing obstacles to achieving fiscal sustainability and advancing monetary tightening.

The U.S. Treasury Secretary has in recent weeks repeatedly signaled his expectation that Japan will tighten its monetary policy. In a Monday interview with CNBC, he said he believes the Japanese government and the BOJ will take "measures that will lead to a stronger yen," suggesting he anticipates a possible rate hike by the central bank and acceptance of that move by the government.

The yen slipped to a near one-month low following hawkish remarks from U.S. Federal Reserve Chair Kevin Warsh last week, approaching the psychologically significant 160 yen per dollar level once again. Market expectations for a rate increase at the BOJ's September 17-18 policy meeting have continued to build. Despite previous joint currency intervention efforts by Japan and the U.S., the yen has drifted back toward 160, underscoring the persistent depreciation pressure it continues to face.