Summary Yen sank for the second straight day Tuesday amid expectations of more stimulus measures in Japan.
NEW YORK (AFP) - The yen sank for the second straight day Tuesday as traders moved away from safe positions amid expectations of more stimulus measures in Japan.
Meanwhile the riskier pound surged on Britain s swift leadership transition after the Brexit vote.
The Japanese currency tumbled 1.8 percent against the dollar to 104.66 yen as the market shifted to risk-on positions.
The weakness also follows comments by Japanese Prime Minister Shinzo Abe, who signaled after his ruling coalition swept weekend parliamentary elections that the government would unveil measures to kickstart growth.
Traders speculated that Japan s central bank may trigger the new stimulus at its July 28-29 meeting.
The pound surged after British Prime Minister David Cameron announced he would give way to his replacement Theresa May in a quick and smooth turnover Wednesday in the wake of the country s shock vote to exit the European Union.
The move comes two months sooner than expected, putting May in charge of negotiating the breakup with the EU.
Vassili Serebriakov at Credit Agricole credited a rise in confidence in the markets with the currency shifts and surges in equity markets.
"Risk-taking sentiment has taken hold this week," he said.
The pound jumped 1.9 percent against both the dollar and euro, to $1.3249 and 83.50 pence, respectively. The euro rose slightly on the dollar to $1.1062.
But Joe Manimbo, a senior market analyst at Western Union Business Solutions, said the pound could be at risk from expected fresh central bank stimulus.
"Despite the pound s improved tone, downside risk looms in the Bank of England which could slash borrowing rates and damage the pound s yield appeal as soon as Thursday," he said.
