The big news from the weekend was the defeat for Japanese Prime Minister Ishiba in the upper house half election.
The yen was moved higher in VERY early trade when there is barely any liquidity at all:
Monday open levels, indicative FX prices, 16 June 2025JPY has opened trading for the week much stronger. USD/JPY circa 147.85, EUR/JPY 172.10Note – It’s a Japanese holiday today, Monday, July 21, 2025 – markets are closed
The narrative centred on a ‘flight to safety’ yen bid. It soon unwound Yen crosses recovered a little:
Yen crosses showing signs of recovery in still thin, early trade
The Financial Times carries the report on Ishiba’s defeat. The FT is gated, but the news is:
Japan ruling party’s election loss means that the ruling coalition, led by PM Ishiba is now reduced to minority in both housesIshiba vowed to stay on as leader, citing the urgent U.S. tariff deadline
Analysts warn of potential policy paralysis and a wider fiscal deficit, though much seems well priced in for nowOpposition parties want looser monetary policy, tax cuts
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This article was written by Eamonn Sheridan at investinglive.com.