Yen drops to 3-month low following Japan's election results

Posted on October 29, 2024   |  

The yen dropped to a 3-month low on Monday, hitting 153.88 against the dollar, as investors believe Japan’s ruling coalition will struggle to raise interest rates after losing its parliamentary majority.

On Monday, the yen was down about 0.2% at 152.65, showing a 6.4% decline for October, which is the largest drop among G10 currencies.

Japan’s Liberal Democratic Party and its junior partner Komeito won 215 seats in the lower house but fell short of the 233 needed for a majority, likely resulting in coalition negotiations.

The U.S. dollar is set for its biggest monthly gain in 2 and a half years against major currencies, driven by positive signs in the U.S. economy and rising yields amid expectations of Donald Trump winning the presidency.

The U.S. dollar index grew by 3.6% to 104.46 in October, marking its largest monthly rise since April 2022. 

It recently fell 0.15% to 104.22.

The euro went up 0.17% to $1.0816 but is still down over 3% for the month.