The two-thirds ‘super majority win’ for Japanese Prime Minister Shinzo Abe’s Liberal Democratic Party on Sunday saw the yen weaken against the dollar in trading on Monday.
Following the results the dollar gained half a percent and was trading at a three month high at 114.10 yen. Against the euro the yen fell 0.1 percent to 113.83.
In its longest winning streak the Nikkei 225 Stock Average gained for a 15th straight day as Japanese shares rose.
Continuation of Monetary Easing by BOJ
This signalled a continuation of the party’s ‘Abenomics’ policy of fiscal spending and monetary easing with expectations that the Bank of Japan won’t change their stance on monetary policy, pushing the yen lower.
According to chief fund manager at Shinkin Asset Management in Tokyo, Naoki Fujiwara who believes that with Japanese companies earnings looking good there is no reason to sell stocks for now. US equities are solid and the yen is in a trend of weakening.
US Tax Cuts
A hurdle was passed on Friday following the US Senate’s approval for the blueprint of the 2018 fiscal year budget, easing the way for the Republicans to push the proposed tax-cut package. The US dollar rose against the yen around 0.9 percent and the euro fell 0.6 percent on Friday following the news.
The focus of markets is now on the appointment of the next Federal Reserve Chair by President Trump.
This week on Thursday the European Central Bank will be holding their policy meeting, where it is expected that they will vote for an extension of their stimulus package and cutting bond purchases. The euro fell 0.3 percent at $1.1754 in trading on Monday.
HighLow binary options broker is one of the few brokers that are authorized and regulated by the Australian Securities and Investments Commission (ASIC) and offer safe and secure trading.
They offer traders some great perks, such as:
• A choice of some of the most traded assets
• Some of the highest returns in the industry with pay outs of up to 200%
• $50 bonus on sign up
• Minimum investment of only $10
• Excellent support in English, Japanese and Chinese
*Please remember that trading binary options can be a risk so always remember to trade with what you can afford.