Japanese Yen Hit Hard after Election

The Japanese Yen plummeted to its lowest level against the greenback in more than 20-months earlier in the Asian session following the expected win of Shinzo Abe’s Liberal Democratic Party (LDP). The LDP has said that they are committed to hastening Japan’s economic recovery and will do so through aggressive monetary easing well beyond the scope already undertaken by the Bank of Japan. The LDP handily won a number of seats in Japan’s Parliament alongside the New Komeito Party which is viewed as a strong ally to the LDP and which, together with a two-thirds majority, can ensure that policies are swiftly enacted.

As reported at 10:27 a.m. (JST) in Tokyo, the USD/JPY pair was trading at one point at 84.48 Japanese Yen, a price last struck in April 2011, well off of the 83.50 Yen price struck on Friday trading in New York. More recently, the pair traded at 83.99 Yen, a gain of 0.6%, following a round of profit taking. The EUR/JPY pair pushed higher from 109.81 Yen and reached a session high of 111.30 Yen before paring gains to 110.51 Yen, still a rise of 0.6%. The AUD/JPY pair also hit a new multi-months peak, striking 89.01 Yen before slipping back on profit taking to 88.53 Yen; the pair is currently higher around 88.61 Yen.