Yen Rises Amid Political Uncertainty After Japan Election

(RTTNews) - The Japanese yen strengthened against other major currencies in the European session on Monday, after Japan's ruling coalition lost its majority in the upper house, indicating the outcome was mostly priced in. Meanwhile, investors were prepared for market uncertainty ahead of a deadline on U.S. tariff discussions.

Prime Minister Shigeru Ishiba's Liberal Democratic Party only managed to reclaim 47 seats, falling short of the 50 seats it required to secure a majority in the upper house, which has 248 representatives.

Japanese stock markets are closed today for Marine Day holiday.

European shares traded lower as EU leaders prepare for a high-stakes showdown over U.S. tariff threats.

The Wall Street Journal reported that EU member states are pressing the European Commission to prepare countermeasures, including tariffs on U.S. goods, restrictions on digital services, and limits on public procurement access.

Overall losses, if any, remained limited as the ECB's quarterly Survey on the Access to Finance of Enterprises showed Eurozone firms remain optimistic about their growth prospects in the next quarter despite trade tensions.

In the European trading today, the yen rose to 5-day highs of 147.69 against the U.S. dollar and 107.67 against the Canadian dollar, from early lows of 148.56 and 108.22, respectively. If the yen extends its uptrend, it is likely to find resistance around 146.00 against the greenback and 106.00 against the loonie.

Against the euro, the pound, the Swiss franc and the Australian dollar, the yen advanced to 4-day highs of 172.01, 198.57, 184.58 and 96.27 from early lows of 172.67, 199.24, 185.28 and 96.68, respectively. The yen may test resistance around 170.00 against the euro, 197.00 against the pound, 183.00 against the franc and 95.00 against the aussie.

The yen edged up to 88.09 against the NZ dollar, from an early low of 88.38. On the upside, 87.00 is seen as the next resistance level for the yen.

Looking ahead, Canada PPI data and raw material prices data for June, Bank of Canada business outlook survey data and U.S. Consumer Board's leading index for June are slated for release in the New York session.