Yen Tumbles Amid Political Uncertainty; Dollar Surges

The yen hit a three-month low against the U.S. dollar following Japan's ruling coalition election loss, leading to political and monetary uncertainty. The dollar surged, marking its biggest monthly gain since April 2022. Rising global yields and political turmoil add pressure on the yen.

The Japanese yen has fallen to a three-month low against the U.S. dollar after Japan faced a political shakeup in the latest elections. The ruling coalition's failure to secure a majority has cast shadows over the country's monetary policies, driving uncertainties in the market.

Following the election results, the dollar soared, culminating in its largest monthly gain since April 2022. Analysts suggest that the political instability weakened the yen further, as Japan's Liberal Democratic Party and its partner, Komeito, struggled to form a ruling government.

This political scenario has affected investor confidence, with analysts predicting a lack of political capital to manage rising rates. Meanwhile, the resilient U.S. economy pushes the dollar higher, with market observers keenly waiting for the upcoming U.S. October employment report.

(With inputs from agencies.)