Yen slumps to 20-month low following LDP victory

SYDNEY Sun Dec 16, 2012 4:22pm EST

SYDNEY (Reuters) - The yen fell to its lowest level in over a year-and-a half against the U.S. dollar on Monday as part of a broad skid after Japan's conservative LDP party, pledged to hyper-easy monetary policy, won a landslide victory at an election.

The dollar rose as far as 84.48 yen, reaching its highest since April 2011, from around 83.50 late in New York on Friday. The euro jumped to around 111.30 yen from 109.81.

The higher-yielding Australian dollar climbed above 89.00 yen for the first time since May 2011.

Japan's conservative Liberal Democratic Party (LDP) surged back to power in an election on Sunday just three years, giving ex-Prime Minister Shinzo Abe a chance to push his radical economic recipe.

Abe has called for "unlimited" monetary easing and big spending on public works to rescue the economy from its fourth recession since 2000.

The Bank of Japan meets later this week and analysts expect the central bank will ease policy further to support an economy already in recession.

(Reporting by Ian Chua)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.