Japanese Yen weakens to two-week low near 157.00 ahead of Japan snap election
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The USD/JPY pair gains momentum to a two-week high near 157.00 during the early Asian session on Friday. The Japanese Yen (JPY) remains under selling pressure against the US Dollar (USD) ahead of Japan’s snap general election on Sunday. The preliminary reading of the Michigan Consumer Sentiment Index report for February will be released later on Friday. Markets expect that a victory for Japanese Prime Minister Sanae Takaichi will lead to expanded fiscal stimulus and continue the JPY’s weakness. Takaichi said that she aims to begin implementing a two-year suspension of the 8% consumption tax on food and beverage items within fiscal 2026, starting in April. This raises concerns about Japan’s fiscal outlook amid fears of debt-funded spending. However, the upside for the pair might be limited amid weaker-than-expected US labor market data. US job openings unexpectedly fell in December to the lowest level since 2020 and layoffs rose. Companies revealed the most job cutbacks in January since the Great Recession in 2009, while applications for US unemployment benefits rose more than forecast last week. A partial government shutdown delayed January Nonfarm Payrolls (NFP) data to February 11, which was previously scheduled for Friday. Federal Reserve (Fed) Governor Lisa Cook said on Monday that she is more concerned about stalled progress on inflation than a weakening labor market. Her remarks signaled that she will not support another interest-rate cut until tariff-induced price pressures begin to recede. Japanese Yen FAQs The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. One of the Bank of Japan’s mandates is currency control, so its…
Filed under: News - @ February 6, 2026 12:28 am