Currency Chaos: Yen and Euro Grapple with Economic and Political Strains

The yen faced its steepest weekly decline in a year, driven by diminished prospects for rate hikes and political changes in Japan. Despite edging up 0.2% against the dollar, it remains near its weakest level since mid-February. Concerns over the Bank of Japan's stance on interest rates are influencing the currency's trajectory.

Political drama in France, with President Macron searching for a new prime minister, has dented the euro. The currency is set for its largest weekly drop in 11 months amid legislative crises and budget challenges, further pressured by economic slowdown evidence in Germany.

The U.S. dollar is witnessing a rally, reaching near two-month highs. Market watchers highlight skepticism about the dollar surpassing significant benchmarks, with a government shutdown and Federal Reserve interest rate cut speculations intensifying market volatility.

(With inputs from agencies.)