Sanae Takaichi seizes control of the House of Representatives, market focuses on fiscal policy design

In the early Asian session on February 9, the yen continued its recent decline. Shoki Omori, Chief Rates and FX Strategist at Mizuho Securities Tokyo, stated that the overwhelming victory of the Liberal Democratic Party has eliminated political uncertainty and strengthened policy implementation. The market focus has now shifted to the design and communication of fiscal policy. The risk of fiscal expansion before the general election has already been priced in by the market, and the key issue is whether these risks will be reinforced or gradually fade away.