EUR strengthens as Japan LDP race uncertainty weighs on risk sentiment

The euro has gained 0.2% against major peers, with EUR/JPY rising to 157.80 and EUR/USD advancing to 1.0835 amid shifting global market dynamics. Japan's Liberal Democratic Party leadership race is creating political uncertainty, weakening the yen as candidates debate monetary policy directions. Meanwhile, Trump's $15 billion lawsuit against the New York Times adds to US political noise, though direct forex impact remains limited. The euro's strength reflects relative stability compared to political uncertainties elsewhere, with European bonds maintaining steady yields. India's bond market stability, despite global volatility, suggests emerging market resilience isn't pressuring major pairs. Technical analysis shows EUR/JPY facing resistance at 158.00, while EUR/USD targets 1.0850. Risk sentiment remains fragile, with any escalation in political tensions likely to benefit traditional safe havens. Traders should monitor Japanese political developments for potential BOJ policy shifts.