Currencies: Yen Holds Steady Amid Japanese Political Turmoil

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As Mel Brooks said, "Politics, politics, politics!" It's all the rage in Japan right now, where the prime minister faces a vote of no-confidence as early as Monday.

The currency markets are holding steady Friday as New York trading begins to pick up; they're watching and waiting, looking to see whether Japan's head of state is ousted next week and whether the U.S. even has designated a new head of state by then.

Dollar/yen was lately traded at 108.84, down a bit from the close of 109.03 yesterday.

Yoshiro Mori

, the Japanese prime minister, is expected to face this no-confidence vote Monday. His chief rival, Koichi Kato, said he will side with opposition parties to vote against Mori. The vote is expected to be close.

"The yen so far is holding in just above key technical support," said Anne Parker Mills, senior economist in foreign exchange at

Brown Brothers Harriman

. "Anywhere between 109.10 and 109.50 is a significant support level. There's a reluctance to do anything, highlighted by the U.S. political uncertainties and compounded by political uncertainties in Japan."

The ongoing U.S. political situation is also causing a bit of concern in the currency markets, although the tussle between Albert Gore and George W. Bush is hardly a crisis. Eventually, one of these men will become president. It's good to be king.

The euro was reasonably quiet, trading up to $0.8545 from $0.8518. There was a brief bounce in the euro overnight, which Mills said raised speculation that the

European Central Bank

intervened in the currency again, generating a little buying interest. That ran out of steam, and the euro fell back.

The euro/yen cross was traded at 93.03 from yesterday's 92.85. The Australian dollar lately traded at $0.5194, down from $0.52 yesterday, and the British sterling rose to $1.4234 from $1.4232 in a quiet session.