Takaichi Pushes Fiscal Expansion as Yen Holds Steady

The Japanese yen held steady at approximately 157.9 per dollar on Tuesday, maintaining a narrow trading range despite Prime Minister Sanae Takaichi's push for fiscal expansion. In her parliamentary speech, Takaichi vowed to cut the consumption tax on food items while ensuring government funding without issuing new bonds, aiming to ease market anxieties over the country's fiscal health.

Market participants are closely monitoring a series of economic reports set to be released this week, including August data on wages, the current account, and household spending, as well as September updates on consumer confidence and machine tool orders. These reports could influence investor sentiment and provide further insights into Japan's economic stability.

Last week, minutes from the Bank of Japan's September meeting revealed growing concerns about inflation surpassing the central bank's 2% target. While the possibility of another rate hike this year was raised, the timing remains unclear ahead of upcoming policy meetings in October and December.