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He hasn’t been too vocal about his views on policy but it is expected that he is likely broadly supportive of the BOJ’s current plans to normalise monetary policy. This keeps the odds of a 25 bps rate hike by the BOJ in December very much alive.
The yen surged earlier on Ishiba’s victory, which upset traders’ positioning for a Takaichi win instead. The latter had been the most vocal among the candidates coming into the election today. And she wasn’t afraid in calling out the BOJ in hiking rates too quickly, at least for her liking.
There would’ve been considerable friction in that case if she had won. But now, we get Ishiba in charge and that’s allaying the fears for yen bulls.
This article was written by Justin Low at www.forexlive.com.
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