The Japanese yen fell against its major counterparts in the Asian session on Monday, as the country’s ruling Liberal Democratic Party secured an outright majority in parliamentary election on Sunday, enabling Prime Minister Fumio Kishida to deliver stimulus measures easily to support the economy from the coronavirus crisis.
The LDP won 261 seats, well above a majority of 233 seats needed to control the parliament’s lower house.
The LDP’s coalition partner Komeito got 32 seats, giving them a total of 293 seats in the 465-member chamber.
The results defied expectations of the LDP struggling to retain its majority and allows PM Fumio Kishida to pass funding steps to support people hit by the crisis.
Japan’s Nikkei 225 jumped on hopes that Kishida can push through economic stimulus plans smoothly by holding the majority of seats in the parliament.
Asian shares are mostly higher, as the strong showing for the LDP ended political uncertainty on the ruling party’s prospects.
The latest survey from Jibun Bank showed that Japan’s manufacturing sector continued to expand in October, and at a faster pace, with a Manufacturing PMI score of 53.2. That’s up from 51.5 in September and it moves further above the boom-or-bust line of 50 that separates expansion from contraction.
The currency was lower on Friday, as Chinese property developer Evergrande reportedly made an overdue interest payment for an offshore bond before a Friday deadline, helping ease contagion fears.
The yen dropped to a 6-day low of 114.30 against the greenback, falling 0.3 percent from Friday close of 113.98. Immediate support for the yen is likely seen around the 116.00 level.
The yen lost 0.2 percent against the euro, reaching 132.09. The pair had finished Friday’s deals at 131.77. Should the yen falls further, it is likely to test support around the 134.00 region.
The yen was down by 0.2 percent against the franc, at 124.72. At Friday’s close, the pair was valued at 124.44. Further fall in the currency may challenge support around the 126.00 level.
The yen was 0.2 percent lower against the pound, at 156.38. The pound-yen pair had ended last week’s trading session at 156.04. The yen is likely to challenge support around the 159.00 region, if it drops again.
The yen touched a 5-day low of 85.95 against the aussie, but it has since rebounded to 85.61. The aussie-yen pair was worth 85.70 at Friday’s close.
The latest survey from Markit Economics showed that Australia’s manufacturing sector continued to expand in October, and at a faster pace, with a manufacturing PMI score of 58.2. That’s up from 56.8 in September, and it moved further above the boom-or-bust line of 50 that separates expansion from contraction.
The Japanese currency slipped to a 6-day low of 82.04 against the kiwi, down from Friday’s close of 81.69. The yen is seen finding support around the 84.00 area.
The yen declined to its lowest level since October 27 against the loonie, at 92.33. The yen was trading at 92.02 per loonie at last week’s close. The currency may face support around the 94.00 region.
Looking ahead, German retail sales data for September, Swiss and U.K. manufacturing PMIs for October will be released in the European session.
U.S. ISM manufacturing PMI for October and construction spending for September are due in the New York session.
The material has been provided by InstaForex Company – www.instaforex.com