U.S. Treasury Secretary Scott Bessent declined to advise Bank of Japan Governor Kazuo Ueda on whether the central bank should deliver back-to-back rate increases, citing respect for its independence and confidence in Ueda’s judgment. Bessent had repeatedly urged Japan from roughly October 2025 through mid-2026 to give the BoJ greater autonomy, a position widely understood as support for higher rates. The BoJ raised its policy rate to 0.75% in December 2025 and later to 1%, while markets considered possible hikes in September or October 2026. The policy debate is unfolding alongside a rare joint U.S.-Japan currency intervention around July 31 to August 1, 2026, aimed at supporting the yen. Prime Minister Sanae Takaichi has historically favored looser monetary policy, creating conflicting signals for Ueda as he weighs economic data against political pressure.