Commerzbank: Upcoming Japanese Election May Lead to Yen Depreciation

According to a report by Jinse Finance, Commerzbank analyst Volkmar Baur stated that Japan's upcoming election could mark a turning point for the country and have a negative impact on the yen. Polls indicate that in Sunday’s House of Councillors election, the government risks losing its majority. He also noted that the possibility of a new election for the House of Representatives cannot be ruled out. This increases uncertainty over future fiscal policy and makes trade negotiations with the United States more challenging, “which will certainly weaken the yen.” Baur added that even if there are no changes, if the government introduces a new fiscal package in response to the election results but fails to address structural issues, the yen could still decline. (Jin10)