Latest news with #politicaluncertainty
South China Morning Post
5 days ago
- Politics
- South China Morning Post
Japan's Ishiba finds unlikely support to stay in power, and prevent far-right shift
Japanese Prime Minister Shigeru Ishiba 's future is uncertain , but an unlikely campaign for him to stay was growing online this week, including from people who are his natural political opponents. The life raft has emerged since upper house elections on Sunday deprived Ishiba's coalition of an upper house majority, months after it suffered a similar disaster in the lower chamber. Despite Ishiba, 68, insisting that he has not discussed his resignation with members of his Liberal Democratic Party (LDP), multiple reports say that it is just a matter of time. Some conservative members of the LDP are collecting signatures to hold a special meeting to discuss a leadership election to oust Ishiba, Fuji TV reported on Friday. One reported signee is Sanae Takaichi, a hardline nationalist and one-time heavy metal drummer who lost a leadership contest to Ishiba in September. Takaichi, 64, would likely run again to lead the party – and become Japan's first woman prime minister if she wins – if Ishiba does depart.
LBCI
23-07-2025
- Politics
- LBCI
US envoy Tom Barrack's Lebanon meetings: Real progress or uncertainty?
Report by Raneem Bou Khzam, English adaptation by Yasmine Jaroudi Amid heightened tensions and political uncertainty, questions loom over whether Lebanon is heading toward further escalation or a potential diplomatic breakthrough following a series of meetings between U.S. envoy Tom Barrack and Lebanese officials. While some political sources described the talks as positive, skepticism remains over whether the momentum can translate into concrete de-escalation on the ground. After a 90-minute meeting with Parliament Speaker Nabih Berri, Barrack described the talks as "great," with sources indicating the atmosphere was positive and a shift from the pessimism that dominated recent days. Still, it is too early to declare a breakthrough. Some of Barrack's other meetings were reportedly less encouraging. According to attendees, the envoy was left with the impression that Hezbollah remains firmly opposed to any handover of weapons and appears more inclined to risk war than engage in a diplomatic compromise that offers no concrete guarantees. Others who met with Barrack said he offered a hypothetical: if Lebanon requested a pause in hostilities and targeted killings and he conveyed that to the Israeli side, the likely response would be a flat rejection—possibly accompanied by a question: "Why should we give Lebanon such a pause?" With details of the talks tightly guarded, the situation remains opaque. In the words of Speaker Berri's now-famous expression, perhaps the best way to describe the moment is with "optimistic pessimism."
Yahoo
22-07-2025
- Business
- Yahoo
Analysis-How Japan's election outcome muddles the BOJ's policy path
By Leika Kihara TOKYO (Reuters) -Japan's election outcome may put the central bank in a double bind as prospects of big spending could keep inflation elevated while potentially prolonged political paralysis and a global trade war provide compelling reasons to go slow on rate hikes. Lingering political uncertainty may also weaken the yen and push up import costs, some analysts say, adding to mounting price pressures that conflict with the Bank of Japan's current approach to stand pat until the political storm calms. The rising cost of living was among factors that led to the bruising defeat of Prime Minister Shigeru Ishiba's ruling coalition in upper house elections on Sunday. With inflation holding above the BOJ's 2% target for over three years now, some BOJ board members have already warned of growing price pressure. Junko Koeda recently argued for the need to monitor second-round effects from rising rice costs. Another board member, Hajime Takata, said this month the BOJ must resume rate hikes after a temporary pause as Japan was on the cusp of achieving the bank's 2% target. "If upward inflation risks heighten, the BOJ may need to act decisively as a guardian of price stability," its hawkish policymaker Naoki Tamura said late last month. Now a minority in both chambers of parliament, Ishiba's ruling camp must compromise with opposition parties, which have called for tax cuts and bigger spending, to pass legislation. In a nod to such calls, Ishiba said on Monday he would stay on as prime minister and work with other parties on measures to cushion the blow to households from rising inflation. While a cut to the consumption tax would leave a huge hole in Japan's worsening finances, doing so would require passing legislation through parliament and take time. More likely would be for Japan to compile an extra budget in autumn to fund payouts and tax breaks. The size could exceed last year's 14-trillion-yen ($95 billion) package given heightening opposition demands for bolder steps, analysts say. "A supplemental budget this fall to help firms cope with U.S. tariffs was expected even before the vote. Now, opposition parties may demand a larger package," said David Boling, a director at consulting firm Eurasia Group. YEN MOVES KEY To be sure, Japan's economy may need the fiscal boost after shrinking in the first quarter and seen taking a hit from U.S. tariffs that are already hurting its mainstay automobile sector. But market worries over Japan's huge debt and political instability could weaken the yen, and cast doubt on the BOJ's view cost-push pressure will ease later this year, analysts say. "With Ishiba signaling his resolve to stay on as premier, markets are now in a wait-and-see mood. But that doesn't mean the chance of yen declines has disappeared, as the election definitely weakened administration's standings," said Tsuyoshi Ueno, an economist at NLI Research Institute. Unlike other major economies, Japan's inflation-adjusted real interest rates remain deeply negative due to the slow pace at which the BOJ rolled back a decade-long, massive stimulus. After raising short-term interest rates to 0.5% in January, Governor Kazuo Ueda has signaled a pause in rate hikes until there is more clarity on the economic impact of U.S. tariffs. Given the risk from U.S. tariffs, many analysts now expect no rate hike for the rest of this year. But staff BOJ estimates suggest its policy rate must rise at least to 1% to reach levels that neither stimulates nor cools growth. In the end, a renewed yen decline could be the next decisive nudge towards further rate hikes, some analysts say. Although the BOJ is guaranteed by law independence from government interference, it has historically been sensitive to political developments. Its massive stimulus in 2013 was deployed after intense pressure from then premier Shinzo Abe to reverse a strong yen and beat deflation. The BOJ's exit from ultra-loose policy last year came after a flurry of calls from politicians to help stem sharp yen falls that were pushing up import costs. "For the BOJ, the biggest concern is how the election could change the government's focus on economic policy, and how markets could react," said a source familiar with its thinking. Veteran BOJ watcher Mari Iwashita sees the chance of a rate hike in October if the yen, now around 147 to the dollar, falls below 150 and puts upward pressure on prices. "Sustained yen weakness would push up underlying inflation, so could be a key trigger for policy action," said Iwashita, who is executive rates strategist at Nomura Securities. ($1 = 147.4300 yen) Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Reuters
22-07-2025
- Business
- Reuters
How Japan's election outcome muddles the BOJ's policy path
TOKYO, July 22 (Reuters) - Japan's election outcome may put the central bank in a double bind as prospects of big spending could keep inflation elevated while potentially prolonged political paralysis and a global trade war provide compelling reasons to go slow on rate hikes. Lingering political uncertainty may also weaken the yen and push up import costs, some analysts say, adding to mounting price pressures that conflict with the Bank of Japan's current approach to stand pat until the political storm calms. The rising cost of living was among factors that led to the bruising defeat of Prime Minister Shigeru Ishiba's ruling coalition in upper house elections on Sunday. With inflation holding above the BOJ's 2% target for over three years now, some BOJ board members have already warned of growing price pressure. Junko Koeda recently argued for the need to monitor second-round effects from rising rice costs. Another board member, Hajime Takata, said this month the BOJ must resume rate hikes after a temporary pause as Japan was on the cusp of achieving the bank's 2% target. "If upward inflation risks heighten, the BOJ may need to act decisively as a guardian of price stability," its hawkish policymaker Naoki Tamura said late last month. Now a minority in both chambers of parliament, Ishiba's ruling camp must compromise with opposition parties, which have called for tax cuts and bigger spending, to pass legislation. In a nod to such calls, Ishiba said on Monday he would stay on as prime minister and work with other parties on measures to cushion the blow to households from rising inflation. While a cut to the consumption tax would leave a huge hole in Japan's worsening finances, doing so would require passing legislation through parliament and take time. More likely would be for Japan to compile an extra budget in autumn to fund payouts and tax breaks. The size could exceed last year's 14-trillion-yen ($95 billion) package given heightening opposition demands for bolder steps, analysts say. "A supplemental budget this fall to help firms cope with U.S. tariffs was expected even before the vote. Now, opposition parties may demand a larger package," said David Boling, a director at consulting firm Eurasia Group. To be sure, Japan's economy may need the fiscal boost after shrinking in the first quarter and seen taking a hit from U.S. tariffs that are already hurting its mainstay automobile sector. But market worries over Japan's huge debt and political instability could weaken the yen, and cast doubt on the BOJ's view cost-push pressure will ease later this year, analysts say. "With Ishiba signaling his resolve to stay on as premier, markets are now in a wait-and-see mood. But that doesn't mean the chance of yen declines has disappeared, as the election definitely weakened administration's standings," said Tsuyoshi Ueno, an economist at NLI Research Institute. Unlike other major economies, Japan's inflation-adjusted real interest rates remain deeply negative due to the slow pace at which the BOJ rolled back a decade-long, massive stimulus. After raising short-term interest rates to 0.5% in January, Governor Kazuo Ueda has signaled a pause in rate hikes until there is more clarity on the economic impact of U.S. tariffs. Given the risk from U.S. tariffs, many analysts now expect no rate hike for the rest of this year. But staff BOJ estimates suggest its policy rate must rise at least to 1% to reach levels that neither stimulates nor cools growth. In the end, a renewed yen decline could be the next decisive nudge towards further rate hikes, some analysts say. Although the BOJ is guaranteed by law independence from government interference, it has historically been sensitive to political developments. Its massive stimulus in 2013 was deployed after intense pressure from then premier Shinzo Abe to reverse a strong yen and beat deflation. The BOJ's exit from ultra-loose policy last year came after a flurry of calls from politicians to help stem sharp yen falls that were pushing up import costs. "For the BOJ, the biggest concern is how the election could change the government's focus on economic policy, and how markets could react," said a source familiar with its thinking. Veteran BOJ watcher Mari Iwashita sees the chance of a rate hike in October if the yen, now around 147 to the dollar, falls below 150 and puts upward pressure on prices. "Sustained yen weakness would push up underlying inflation, so could be a key trigger for policy action," said Iwashita, who is executive rates strategist at Nomura Securities. ($1 = 147.4300 yen)
Yahoo
22-07-2025
- Business
- Yahoo
Analysis-How Japan's election outcome muddles the BOJ's policy path
By Leika Kihara TOKYO (Reuters) -Japan's election outcome may put the central bank in a double bind as prospects of big spending could keep inflation elevated while potentially prolonged political paralysis and a global trade war provide compelling reasons to go slow on rate hikes. Lingering political uncertainty may also weaken the yen and push up import costs, some analysts say, adding to mounting price pressures that conflict with the Bank of Japan's current approach to stand pat until the political storm calms. The rising cost of living was among factors that led to the bruising defeat of Prime Minister Shigeru Ishiba's ruling coalition in upper house elections on Sunday. With inflation holding above the BOJ's 2% target for over three years now, some BOJ board members have already warned of growing price pressure. Junko Koeda recently argued for the need to monitor second-round effects from rising rice costs. Another board member, Hajime Takata, said this month the BOJ must resume rate hikes after a temporary pause as Japan was on the cusp of achieving the bank's 2% target. "If upward inflation risks heighten, the BOJ may need to act decisively as a guardian of price stability," its hawkish policymaker Naoki Tamura said late last month. Now a minority in both chambers of parliament, Ishiba's ruling camp must compromise with opposition parties, which have called for tax cuts and bigger spending, to pass legislation. In a nod to such calls, Ishiba said on Monday he would stay on as prime minister and work with other parties on measures to cushion the blow to households from rising inflation. While a cut to the consumption tax would leave a huge hole in Japan's worsening finances, doing so would require passing legislation through parliament and take time. More likely would be for Japan to compile an extra budget in autumn to fund payouts and tax breaks. The size could exceed last year's 14-trillion-yen ($95 billion) package given heightening opposition demands for bolder steps, analysts say. "A supplemental budget this fall to help firms cope with U.S. tariffs was expected even before the vote. Now, opposition parties may demand a larger package," said David Boling, a director at consulting firm Eurasia Group. YEN MOVES KEY To be sure, Japan's economy may need the fiscal boost after shrinking in the first quarter and seen taking a hit from U.S. tariffs that are already hurting its mainstay automobile sector. But market worries over Japan's huge debt and political instability could weaken the yen, and cast doubt on the BOJ's view cost-push pressure will ease later this year, analysts say. "With Ishiba signaling his resolve to stay on as premier, markets are now in a wait-and-see mood. But that doesn't mean the chance of yen declines has disappeared, as the election definitely weakened administration's standings," said Tsuyoshi Ueno, an economist at NLI Research Institute. Unlike other major economies, Japan's inflation-adjusted real interest rates remain deeply negative due to the slow pace at which the BOJ rolled back a decade-long, massive stimulus. After raising short-term interest rates to 0.5% in January, Governor Kazuo Ueda has signaled a pause in rate hikes until there is more clarity on the economic impact of U.S. tariffs. Given the risk from U.S. tariffs, many analysts now expect no rate hike for the rest of this year. But staff BOJ estimates suggest its policy rate must rise at least to 1% to reach levels that neither stimulates nor cools growth. In the end, a renewed yen decline could be the next decisive nudge towards further rate hikes, some analysts say. Although the BOJ is guaranteed by law independence from government interference, it has historically been sensitive to political developments. Its massive stimulus in 2013 was deployed after intense pressure from then premier Shinzo Abe to reverse a strong yen and beat deflation. The BOJ's exit from ultra-loose policy last year came after a flurry of calls from politicians to help stem sharp yen falls that were pushing up import costs. "For the BOJ, the biggest concern is how the election could change the government's focus on economic policy, and how markets could react," said a source familiar with its thinking. Veteran BOJ watcher Mari Iwashita sees the chance of a rate hike in October if the yen, now around 147 to the dollar, falls below 150 and puts upward pressure on prices. "Sustained yen weakness would push up underlying inflation, so could be a key trigger for policy action," said Iwashita, who is executive rates strategist at Nomura Securities. ($1 = 147.4300 yen)
