How Will Japan’s Election Shock Impact the Yen? | Presented by CME Group

Market Reaction - Initial market reaction to the Japanese election results saw the yen strengthen, potentially due to its safe-haven status [1][2] - Japanese equities (Nikkei index) remained steady, possibly anticipating a reversal of the yen's appreciation to benefit exports [3] Political and Economic Implications - The coalition government experienced significant losses in the election [1] - The rise of right-wing populist parties could introduce instability into financial markets [1] - Discontent over stagnant wages amidst inflation and increased foreign workers contributed to the election outcome [4] - Dramatic political transitions are generally perceived negatively, potentially impacting the economy and foreign investor risk appetite, which could harm Japanese stocks [4]