FX.co ★ Japanese Yen Gains on Safe-Haven Bid

On Monday, the Japanese yen strengthened beyond 158 against the US dollar, reaching a one-week high. This appreciation was driven by escalating geopolitical and trade tensions, prompting investors to seek safe-haven assets. US President Donald Trump has sparked controversy by threatening to impose new tariffs on eight European nations as part of an attempt to assert control over Greenland, a move that has attracted criticism from European leaders. Meanwhile, in Japan, the focus is on the Bank of Japan's policy decision scheduled for this week. While interest rates are expected to remain unchanged, June may hold prospects for policy adjustments. Additionally, there is speculation that Prime Minister Sanae Takaichi could call for a snap election next month. This potential election would aim to consolidate her authority and advance expansionary fiscal strategies. One such strategy reportedly under consideration is her campaign proposal to temporarily suspend the 8% sales tax on food, a measure designed to alleviate the burden of rising food costs in Japan.