Takaichi's LDP Poised for Victory in Japan's General Election

A preliminary survey indicates that Japanese Prime Minister Sanae Takaichi's Liberal Democratic Party is set to gain a majority in the upcoming general election. The election aims to support Takaichi’s fiscal policies, potentially affecting market dynamics with increased bond yields due to expected additional debt issuance.

The Liberal Democratic Party, led by Prime Minister Sanae Takaichi, is poised to secure a majority in Japan's lower house, according to a preliminary survey by the Nikkei newspaper. This electoral push, scheduled for February 8, was initiated by Takaichi to gain support for her expansionary fiscal policy.

The anticipated victory comes as the LDP, currently holding 198 seats, is predicted to surpass the 233-seat threshold needed for a majority of the 465 seats available. Currently, the LDP maintains a ruling coalition with the Japan Innovation Party, retaining a slim majority despite being a minority in the upper house.

The survey results reflect findings from a joint poll by Nikkei and the Yomiuri newspaper conducted in late January. The potential election outcome has sparked market concerns over increased bond yields as Japan might be prompted to issue additional debt.