

Japanese Stocks Jump on Sanae Takaichi's Election Win
Oct 6, 2025
Paul Dobson, Executive Editor for Asia Markets at Bloomberg, and Christopher Lafleur, Chairman of the American Chamber of Commerce in Japan, discuss the significant market reactions following Sanae Takaichi's election as Japan's first female prime minister. They explore how her pro-stimulus policies led to a weakened yen and a rally in Japanese stocks. The duo also examines the implications for U.S.-Japan relations, the potential pause in Bank of Japan rate normalization, and the impact on global commodity prices and investor sentiment.
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Market Reaction To Takaichi Win
- Sanae Takaichi's LDP victory surprised markets and triggered a sharp yen depreciation and equity rally.
- Markets view her as pro-stimulus and likely to delay BOJ normalization, boosting growth expectations but weakening the yen.
Bond Market Will Set Fiscal Limits
- Bond-market response will determine whether fiscal stimulus is feasible without higher yields.
- If investors demand higher yields, increased borrowing could limit Takaichi's room for stimulus.
BOJ Faces Political And Policy Crossroads
- The BOJ appears intent on gradual rate normalization but politics could delay action.
- Markets will closely monitor BOJ comments to trade bonds and currencies around potential delay risks.