• Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
Stock

The Ishiba exit: A shock resignation plunges Japan’s future into deep uncertainty

by September 8, 2025
by September 8, 2025

A political earthquake has rocked Japan, as Prime Minister Shigeru Ishiba, battered by a series of humiliating election setbacks and facing an internal party rebellion, announced he will step down.

The stunning resignation ends a brief and troubled tenure, plunging the world’s fourth-largest economy into a period of deep uncertainty and setting in motion a fierce and unpredictable race to succeed him.

The announcement, delivered at a press conference in Tokyo on Sunday, was a reluctant admission of defeat. “While I feel there are still things I wish to do as premier, I have made the difficult decision to step down,” Ishiba said.

He acknowledged that if he had continued to cling to power, it “could have created an irreversible division within the party, which is certainly not my intention.”

A market on edge, a legacy in question

The market reaction was immediate and severe. The Japanese yen, a traditional safe haven, slid 0.7 percent against the dollar in early trading as a new wave of political instability washed over the nation.

While the weaker currency provided a tailwind for Japanese stocks, the country’s fragile bond market came under intense pressure, with yields on long-term debt, which had already hit multi-decade highs last week, seen as particularly vulnerable.

The core of the market’s anxiety is the fear that Ishiba’s departure will spell the end of fiscal discipline.

“Prime Minister Ishiba was known for his strict stance on fiscal discipline,” said Katsutoshi Inadome, a senior strategist at Sumitomo Mitsui Trust Asset Management.

“While it remains unclear who will become the next prime minister, it’s difficult to envision anyone with a fiscal discipline stance better than or even equivalent to his.”

Ishiba attempted to frame his exit as a matter of timing, stating that having seen the contentious U.S. trade negotiations through, he felt it was “the right time to stand down and give way to my successor.”

The signing of the executive order by President Donald Trump last week, which finalized the deal, does provide Ishiba with a tangible, if modest, legacy to walk away with after a turbulent year at the helm.

The succession scramble: a battle for the soul of the party

Now, a frantic and high-stakes scramble to replace him has begun. The ruling Liberal Democratic Party (LDP) will now hold a leadership race, a contest that will be a battle for the soul of the party and the future direction of the country.
Potential candidates are already jockeying for position.

They include Sanae Takaichi, a former internal affairs minister from the party’s right wing who favors more stimulus and a cautious approach to interest rate hikes.

Her potential victory is the market’s nightmare scenario.

“If Ms. Takaichi is appointed, bond selling could intensify due to the risk of a credit rating downgrade,” warned Inadome. In that scenario, “we could see a triple dip: falling bond prices, a weaker yen, and declining stock prices.”

Other potential contenders include Shinjiro Koizumi, the son of a popular former prime minister who could give the LDP a fresher, more appealing face, and a host of other party veterans.

While the LDP’s dominance in parliament has traditionally all but guaranteed that its leader will become prime minister, the party’s recent election losses have fractured the Diet, injecting a new and unpredictable element into the race.

The next leader will face a daunting array of challenges, from global trade headwinds to simmering resentment at home over the soaring cost of living, a challenge that proved too great for his predecessor to overcome.

The post The Ishiba exit: A shock resignation plunges Japan’s future into deep uncertainty appeared first on Invezz

0 comment
0
FacebookTwitterPinterestEmail

previous post
Morning brief: Japan PM’s resignation stuns markets; Pop Mart shares tumble
next post
Asian markets open: Nikkei rises as yen falls after Japan PM resigns; Sensex to open higher

Related Posts

Disney warns YouTube TV subscribers of potential blackout...

October 24, 2025

Top catalysts for the CAC 40 index next...

October 24, 2025

European stocks open higher, buoyed by a wave...

October 24, 2025

NatWest share price forecast as its earnings jump:...

October 24, 2025

Piyush Pandey dies at 70: The ‘Fevicol’ &...

October 24, 2025

Investors brace for Argentina’s midterm vote as Milei’s...

October 24, 2025

Reliance ramps up oil imports as US sanctions...

October 24, 2025

UK retail sales unexpectedly rise 0.5% in September,...

October 24, 2025

Reddit sues AI search engine Perplexity over data...

October 23, 2025

Europe markets open: Stoxx up 0.3% as Kering’s...

October 23, 2025

Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.

By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

Recent Posts

  • AIER’s Everyday Price Index Inches Up Again in Sept 2025

    October 24, 2025
  • Argentina’s Midterm Moment: Brave Reform, or Back to Perónism?

    October 24, 2025
  • Imagine That Growth: Lessons from a Tariff-Free Timeline

    October 24, 2025
  • Disney warns YouTube TV subscribers of potential blackout as carriage talks stall

    October 24, 2025
  • Top catalysts for the CAC 40 index next week

    October 24, 2025
  • European stocks open higher, buoyed by a wave of strong corporate earnings

    October 24, 2025

Editors’ Picks

  • 1

    Meta executives eligible for 200% salary bonus under new pay structure

    February 21, 2025
  • 2

    Pop Mart reports 188% profit surge, plans aggressive global expansion

    March 26, 2025
  • 3

    New FBI leader Kash Patel tapped to run ATF as acting director

    February 23, 2025
  • 4

    Walmart earnings preview: What to expect before Thursday’s opening bell

    February 20, 2025
  • 5

    Cramer reveals a sub-sector of technology that can withstand Trump tariffs

    March 1, 2025
  • 6

    Anthropic’s newly released Claude 3.7 Sonnet can ‘think’ as long as the user wants before giving an answer

    February 25, 2025
  • 7

    Nvidia’s investment in SoundHound wasn’t all that significant after all

    March 1, 2025

Categories

  • Economy (2,990)
  • Editor's Pick (295)
  • Investing (185)
  • Stock (2,042)
  • About us
  • Contact us
  • Privacy Policy
  • Terms & Conditions

Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Read alsox

Explained: Wolfspeed stock soars 1,700% but investors...

September 30, 2025

What awaits Musk at Tesla, SpaceX, and...

May 30, 2025

Europe markets in red: Fed rate cut...

September 16, 2025