Political Upheaval Shakes Global Currency Markets

On Monday, political shifts played a dominant role in the currency markets. The Japanese yen saw its sharpest drop in five months against the dollar, with Sanae Takaichi poised to become Japan's next prime minister, and the euro declined following the resignation of France's new government.

Sanae Takaichi, a former economic security minister, won the leadership of Japan's ruling Liberal Democratic Party over the weekend, positioning her to become the country's next prime minister and prompting traders to adjust their expectations of the Bank of Japan's interest rate policy.

Elsewhere, France's political uncertainty after the resignation of Prime Minister Sebastien Lecornu and his government put additional pressure on the euro, while ongoing concerns about U.S. economic data added to the market's volatile environment.

(With inputs from agencies.)