
Japanese yen soft ahead of Sunday election, US dollar clings to weekly gains
The dollar was steady against the yen on Friday at 148.56 , heading for a weekly rise of 0.7% on the Japanese currency, more than its gains against the euro, pound or Swiss franc.
Part of the reason for the weakness is Sunday's election. Polls suggest Japan's ruling coalition is at risk of losing its majority - a development that would stir policy uncertainty at home and complicate tariff negotiations with the U.S.
"A lurch through the 150-level (yen per dollar) is likely if the government loses its majority," said Derek Halpenny, head of research, global markets EMEA at MUFG, and that moves on Monday could be exacerbated by thin liquidity because of a holiday in Japan.
"With most other parties calling for further support for households, speculation of additional fiscal spending will likely see further rises in (Japanese government bond) yields and additional yen selling," Halpenny said.
U.S. tariffs are adding pressure to the yen, as Japan, which initially was touted by the White House as likely to be among the first to reach a trade deal, has been deadlocked with Washington over politically sensitive issues of car and agriculture tariffs.
Japan's top trade negotiator, Ryosei Akazawa, held talks with U.S. Commerce Secretary Howard Lutnick on Thursday, as Tokyo races to avert a damaging 25% levy after an August 1 deadline.
Elsewhere, currencies were consolidating, with the dollar weaker on the day on most peers, but still set for a weekly gain as strong U.S. economic data caused traders to pare back their expectations for Federal Reserve rate cuts in the near term.
The euro was up 0.4% on the dollar at $1.1643 and the pound was up 0.26% at $1.3453 , though both are set for weekly declines.
The dollar index, which tracks the currency against six main peers, was last 98.31, up 0.5% on the week, building on the previous week's 0.91% rally .
U.S. data Thursday showed retail sales rebounded more than expected in June and first-time applications for unemployment benefits dropped to a three-month low last week.
That, in combination with data earlier in the week showing U.S. consumer prices increased by the most in five months in June, has shifted Fed expectations.
Traders currently price about 45 basis points of U.S. rate cuts for the remainder of the year, down from closer to 50 basis points at the start of the week.
Clouds of uncertainty still hang over the dollar though, which has been shaken in recent days and weeks by fiscal worries from Trump's massive spending and tax-cut bill, as well as the U.S. President Donald Trump's relentless criticism of Fed Chair Jerome Powell for not cutting rates.
The dollar index remains 9.15% lower over the course of this year, following a steep selloff in March and April when Trump's erratic trade policies undermined confidence in U.S. assets, sending the currency, Treasury bonds and Wall Street stocks all lower.
Elsewhere, the dollar was down 0.4% on the Swiss franc at 0.8001 francs while Bitcoin hovered just above $120,000.
The world's biggest cryptocurrency pushed to an all-time peak of $123,153.22 this week, with the U.S. Congress passing a bill to create the framework for dollar-pegged stablecoins.
Ether, the second-largest crypto currency, outperformed, hitting a six-month high and was last up 5.6% on the day at $3,610.
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Daily Mail
28 minutes ago
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After Donald Trump sues Wall Street Journal over claim he wrote bawdy note to paedophile, MoS reveals Bill Clinton sent 'warm and gushing' letter for Jeffrey Epstein's 50th birthday
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Daily Mail
an hour ago
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Top politician who's a 'shoo-in' to win the 2028 presidential election
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Telegraph
an hour ago
- Telegraph
Epstein's brother demands release of paedophile's unseen interviews
Jeffrey Epstein's brother is demanding the release of hours of unseen interviews with the paedophile financier as the clamour grows in Washington to find out whether he was protecting a circle of powerful figures. The controversy has roiled the administration of Donald Trump after he promised to release all the files from the Epstein investigation and subsequently has not. This week, the row hit a boiling point as it was claimed the President sent a lewd birthday letter to Epstein. Mr Trump has furiously denied sending the message and a drawing of a naked woman and is suing the Wall Street Journal and its owners including Rupert Murdoch for at least $10 billion (£7.4 billion). He has also ordered the justice department to release the grand jury transcripts in the 2019 case against Epstein. Now attention has turned to Steve Bannon, former chief strategist to the president. He spent hours with Epstein in the summer of 2019 in what is thought to have been his final interview before his arrest. 'Let me see the videotapes,' said Mark Epstein, who said he now had doubts about the official story that his brother died by suicide. 'He's my brother.' Epstein died in August 2019. His death in a jail cell triggered a wave of conspiracy theories, suggesting he had been murdered in order to ensure he could not implicate anyone in his circle of wealthy friends. Mr Trump promised to publish what became known as the 'Epstein files' but his Department of Justice this month announced that its review of the evidence confirmed he had died by suicide and there were no grounds for further investigation of his contacts. The story was catapulted back into the headlines at the end of the week. Mr Trump was accused of sending a message and a drawing of a naked woman to Epstein for his 50th birthday in 2003. Epstein's brother said the financier worked with Mr Bannon, a huge star in the Maga media world, after the Miami Herald in 2018 revealed the stories of women who said they had been abused. 'He told me he has like 15 or 16 hours of videotape of Jeff. He was trying to help Jeff rehabilitate his reputation,' he told NBC News. 'They spent a lot of time together.' A trailer obtained by the New York Post for a documentary entitled 'The Monsters: Epstein's Life Among the Global Elite' shows Mr Bannon with Epstein, who claims to be a supporter of the #TimesUp movement. 'I made my living from old thinking but the future is for the way women think,' he says. 'The way women think?' asks Mr Bannon. 'Is that not a sop because of all of the depravity you've done against young women?' Epstein grins. 'No … I've always believed that women would be, in fact, be able to take over,' he replies. 'I'm a firm believer and supporter of Time's Up.' Epstein was convicted in 2008 by a Florida state court of procuring a child for prostitution and of soliciting a prostitute as part of a controversial plea deal that meant he only served 13 months in custody. He was arrested again in July 2019, after a string of other women came forward to say they had been abused as minors. During the interview, he even foreshadows his own death. 'The greatest threat to people put in solitary confinement is they try to kill themselves,' he says. Mark Epstein said he has doubts about the official explanation of his brother's death.'My concern is that my brother was killed,' he said, adding, 'More and more, I believe he was murdered, and everyone who looks at all the information that's out there on facts comes to the same conclusion, correct?' At the end of the week, Mr Trump asked for the release of grand jury testimony connected to Epstein. The decision rests with a New York federal judge. 'With that being said, and even if the Court gave its full and unwavering approval, nothing will be good enough for the troublemakers and radical left lunatics making the request,' Mr Trump said on Saturday via his Truth Social website. 'It will always be more, more, more.' At the same time, his friendship with Epstein has been under fresh scrutiny since The Wall Street Journal reported details of what it said was a birthday message he had sent to the financier. It allegedly includes a sketch, depicting a woman's breasts and a 'Donald' signature in the place of pubic hair, and concludes with the line: 'Happy Birthday — and may every day be another wonderful secret.' The two both lived in Palm Beach and moved in some of the same circles, but they had a falling out before Epstein's first arrest. Mr Trump denied he had sent it and quickly launched a defamation suit against the newspaper, two reporters and Rupert Murdoch, its proprietor.