Japan: Politics back in focus - Nomura

In Japan, politics are again in focus and an early snap election is becoming more likely, as early as on 22 October, and political headlines will likely have more impact on JPY.

Key Quotes

“If PM Abe survives by securing an LDP single-party majority with a sufficient margin as the latest poll suggests, an accommodative BOJ monetary policy will likely continue for longer, supporting JPY weakness. Historically, into Election Day risk sentiment tends to improve too, and this should support commodity currencies against JPY.”