Yen Steadies as Japan's New Prime Minister Signals Continued Accommodative Monetary Policy

Japan's yen steadied after incoming Prime Minister Shigeru Ishiba signaled that monetary policy should remain accommodative. The dollar slipped against commodity currencies amid expectations of a turnaround in China's economy. Analysts believe Ishiba's stance may keep the yen stable, but a potential snap election could add uncertainties.

Japan's yen stabilized on Monday after incoming Prime Minister Shigeru Ishiba indicated that monetary policy would remain accommodative. The yen had surged on Friday following Ishiba's leadership win in the ruling Liberal Democratic Party.

The dollar slipped against commodity currencies due to rising investor expectations of an improved economic outlook in China. Ishiba's victory only slightly paused the yen's sharp rise. Analysts predict that the possibility of a snap election could introduce short-term instability for the yen.

Elsewhere, the euro remained stable at $1.1172 and sterling traded at $1.3381, with markets closely watching U.S. jobs data for future guidance on U.S. interest rates. Commodity currencies like the Australian and New Zealand dollars saw gains amid hopes of economic recovery catalyzed by China's policy measures. The yuan also rallied, surpassing the 7-per-dollar mark.

(With inputs from agencies.)