U.S. Treasury Secretary Scott Bessent has called on Japan to hike interest rates by invoking director Spike Lee’s most famous movie and saying that the Bank of Japan should “do the right thing.”

The 1989 film takes place during a sizzlingly hot day in Brooklyn, while Tokyo in 2026 is actually enjoying an unusually cool summer. Despite the weather, tensions are running high.

Bessent is piling pressure on BOJ Gov. Kazuo Ueda by noting that Japan has “probably reached the end of Abenomics.” He’s right, but he’ll find that cuts both ways: During the former Shinzo Abe’s heyday as prime minister, the government and central bank were in lockstep — nowhere more so than on messaging. Bessent himself, then in the hedge fund business, was an early receiver of this signal and profited to the tune of $1 billion by shorting the yen starting in late 2012.

The quality of communication is very different in Tokyo these days. A September hike is likely already nailed on, so what the market is expecting is hawkish communication. The cost of a BOJ........

© The Japan Times