Sanae Takaichi won the management of the Liberal Democratic Party (LDP) elections at the weekend. Given her affinity to “Abenomice” – Ultra -Expansionary fiscal and monetary policy of former Prime Minister Shinzo Abe – one should expect the depreciation of Japanese Jen (JPY) in response to her victory. And that’s exactly what happened. However, the future of the Japanese currency now depends heavily on how closely it will imitate Abenomics, Commerzbank’s head FX and commodity research that Lan nguyen notes.
Takichi’s victory may not hurt yen
“Since the Ruling Coalization No Longer Holds an Outright Majority in Both Houses of Parliament, IT Seems Doubtful That The New Government Will Pursue or Be Able to Pursue Similarly Aggressive Police. Policy, Compared to About and Year Ago – Likely Aware That She Cannot Alienate The LDP’s Coalition Partner Or Opposition Parties, Asir Support Will Be Crucial for Promotion of her political agenda.
“In addition, the abenomics were originally designed to pull Japan out of decades long stagnation and deflation. Recently, the Japanese bank (fight) focused on the fight against excessive inflation.
“All in all, Takaichi’s victory may not hurt Yen so much in a medium to long -term horizon, as some are currently afraid of.”
