The Japanese Yen (JPY) is weak, down 0.3% against the US Dollar (USD) and underperforming all of the G10 currencies to start the week, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

Markets consider BoJ reaction to PM Ishiba’s intention to step down

"Political developments are weighing on the yen as markets digest PM Ishiba’s Sunday announcement of his intention to depart in the coming weeks. The prospect of renewed political uncertainty will likely factor into the BoJ’s considerations as they formulate their shift toward tighter policy."

"The BoJ had paused their tightening cycle through the spring and summer, on the back of trade and political uncertainty, as well as bond market turbulence. USDJPY remains range bound, and fundamentals remain supportive for the yen (USD/JPY lower). We look to a near-term range bound between 147.37 (50 day MA) support and 148.83 (200 day MA) resistance."