After Japan’s recent snap election, the nation is experiencing political uncertainty which has had a direct impact on the economy. The ruling coalition, led by the Liberal Democratic Party (LDP) of Prime Minister Shigeru Ishiba, has lost its majority for the first time since 2009. This unexpected outcome has sent shockwaves through the financial markets, resulting in a weaker yen and gains in the stock market.
One of the key factors contributing to this political shift is the cost-of-living crisis that has been affecting the Japanese population. With rising prices and stagnant wages, many voters are growing increasingly frustrated with the current government’s handling of economic issues.
The country’s central bank, the Bank of Japan, is also facing scrutiny for its policy of hiking interest rates. As the economy struggles to recover from the impact of the Covid-19 pandemic, there are concerns that raising interest rates could further hinder growth and exacerbate the cost-of-living crisis.
Moving forward, it remains to be seen how the new political landscape in Japan will impact the economy. Investors are closely monitoring the situation and adjusting their strategies accordingly. The weakening yen and stock gains are just the beginning of what could be a period of significant economic flux in Japan.
Overall, the aftermath of the snap election has left many uncertainties looming over Japan’s economy. The coming months will be crucial in determining the country’s financial future and how the government will navigate these challenging times.
Watch the video by FRANCE 24 English
Video “After Japan's snap election, political uncertainty leads to weaker yen and stock gains • FRANCE 24” was uploaded on 10/28/2024 to Youtube Channel FRANCE 24 English