Japan Election - Follow Up
Investment Conclusion
There is no change in strategy: short 10yr JGBs; Neutral Nikkei and Yen (but considering a short Vs SGD, AUD and RMB (where I am already long)).
The LDP and its ruling coalition results are even stronger that the exit polls indicated (see: Takaichi’s Gamble Pays Off 02.08.20260 – Note 1 ).
It now appears that the LDP on its own won 316 seats and together with its coalition partners 354 seats out of a total of 465 seats. That is a “Super Majority” (more than 66% majority). That's enough to change the Constitution and do away with Japan's pacifist stance. And it opens the door wide to Takaichi's spending ambitions
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