Japan: Big win for Shinzo Abe at parliamentary election
|The Japan election sent the USD/JPY to a three-month high above yen 113.50 for one single dollar note. Shinzo Abe won by a clear majority (312 seats out of 465 possible, more than a two-thirds majority). The prime minister victory is synonym of continuation of the Abenomics. The free money is then likely to continue flooding in Japan for some more time. The Nikkei has by the way reacted very positively by setting an all-time high to 21805 points.
This result may sound as contradictory knowing the failure of the Abenomics so far. The targets set up by Shinzo Abe have not been reached. The Japanese debt has never been so strong and the country struggles against deflation. Wages growth are very low. The truth is that the country needs this very loose monetary policy to keep going.
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Abe promised to open up Japan to foreign investments in order to boost Japan’s economy. Abe, which political future seemed at staked is now like a phoenix reborn from ashes. Next time, it won’t likely work that way!
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