Yen Falls As Traders Bet On Japan's LDP Election Results
27 September 2024 - 1:56PM
RTTF2
The Japanese yen weakened against other major currencies in the
Asian session on Friday, as traders started speculating the Japan's
New Prime Minister to be decided by the Liberal Democratic Party's
presidential election.
Speculations of political pressure on monetary policy paved the
way for traders to bet on the election results.
Meanwhile, no candidate secured majority in the first round of
LDP voting. Top candidates are former Defense Chief Shigeru Ishiba,
former Environment Minister Shinjiro Koizumi, and Economic Security
Minister Sanae Takaichi, who secured 154, 136, and 181 votes,
respectively. The needed majority was supposed to be 368 votes.
This means that Ishiba and Takaichi will now face off in the
run-off vote.
Asian stock markets traded higher, following the broadly
positive cues from Wall Street overnight, as traders continue to
bet on further reductions in interest rates by the U.S. Fed, and on
hopes about more stimulus measures from the Chinese government to
spur growth in the world's second largest economy.
In economic news, overall consumer prices in the Tokyo region of
Japan were up 2.2 percent on year in September, the Ministry of
Internal Affairs and Communications said on Friday. That was in
line with forecasts and was down from 2.6 percent in August. Core
CPI, which excludes the volatile costs of food, rose an annual 2.0
percent - again matching expectations and slowing from 2.4 percent
in the previous month.
In the Asian trading today, the yen fell to nearly a 1-1/2-month
low of 163.50 against the euro and nearly a 2-month low of 195.96
against the pound, from yesterday's closing quotes of 161.83 and
202.00, respectively. The yen is likely to find support around
170.00 against the euro and 202.00 against the pound.
Against the U.S. dollar and the Swiss franc, the yen slipped to
more than 3-week lows of 146.49 and 172.53 from Thursday's closing
quotes of 144.80 and 171.10, respectively. On the downside, 151.00
against the greenback and 176.00 against the franc are seen as the
next support levels for the yen.
Against Australia, the New Zealand and the Canadian dollars, the
yen dropped to nearly a 2-month low of 100.72, more than a 2-month
low of 92.29 and more than a 3-week low of 108.56 from yesterday's
closing quotes of 99.84, 91.61 and 107.54, respectively. If the yen
extends its downtrend, it is likely to find support around 106.00
against the aussie, 96.00 against the kiwi and 112.00 against the
loonie.
Looking ahead, German unemployment data for September, Eurozone
economic sentiment survey results for September and the
Confederation of British Industry's U.K. Distributive Trades survey
results for September are due to be released in the European
session.
In the New York session, Canada GDP data for July, U.S. personal
income and spending data for August, goods trade balance for
August, PCE price index for August, retail an wholesale inventories
for August, U.S. University of Michigan's consumer sentiment for
September, Canada budget balance for July and U.S. Baker Hughes
weekly oil rig count data are slated for release.
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