Ichiro Ozawa knows how painful court proceedings can be: the Japanese ruling party heavyweight is famed for having loyally attended all 191 sessions of the late prime minister Kakuei Tanaka’s multi-year corruption trial, the FT reports. This time, however, it is Mr Ozawa himself who faces time in the dock, following a prosecution review panel’s decision to order his indictment for allegedly submitting false fundraising reports. The panel’s ruling, made last month but announced on Monday, strikes a potentially disastrous blow to the fortunes of one of Japan’s most forceful and influential politicians. It is also likely to dramatically alter the internal dynamics of the ruling Democratic party of Japan. Read more
Japan’s prime ministerial revolving door missed a turn as incumbent Naoto Kan successfully fended off a challenge to his leadership from fellow ruling Democratic party heavyweight Ichiro Ozawa, the FT reports. Mr Kan’s surprisingly emphatic victory on Tuesday after a hard-fought campaign for re-election as DPJ president meant relative continuity in the economic and diplomatic policies pursued by his administration since it took office three months ago. If Mr Kan had lost, his successor would have been Japan’s sixth new prime minister in four years. In a sharp reminder of the pressing challenges faced by the DPJ-led government, Mr Kan’s victory sent the yen climbing to a new 15-year high of Y82.90 to the dollar. Read more
So the fat lady has sung – or rather, the sumo wrestler has grunted – and Japan’s latest political circus is over (for now).
Naoto Kan has retained his somewhat battered position as the country’s prime minister, defeating the “shadow shogun” of his party — but only narrowly by 206-200 in the crucial vote among parliamentarians in the ruling DPJ. And, as the FT reports, all eyes are on the yen. Read more
Such is the state of Japanese politics that it’s big news these days to be able to report that Japan’s prime minister is still Japan’s prime minister, reports FT Alphaville. Naoto Kan on Tuesday afternoon fended off the most serious challenge to his hitherto short and intense leadership of the ruling DPJ from the controversial Ichiro Ozawa. The yen rose further in response, reaching Y83.09 to the dollar on Tuesday from Y83.60 earlier, driven by the view that Kan’s endless pledges to act to curb yen strength will continue to prove hollow. Read more
The yen rose to a 15-year high against the dollar on Tuesday amid speculation that Japanese prime minister Naoto Kan will beat rival Ichiro Ozawa for leadership of the ruling DPJ in a Tuesday vote set for 2pm Tokyo time (6am BST), reports Bloomberg. Earlier, the FT reported that Kan looked to have secured most of the 30%-plus of local postal votes used to decide such contests, but said Ozawa could yet prevail among the 412 DPJ national Diet members, who account for the remaining near-70% of votes. An Ozawa victory could mean a far more stimulative economic policy in the short term – and possible currency intervention – but also a larger gross state debt. Read more
Japan’s prime minister and a heavyweight challenger from his ruling Democratic party battled on Monday for the backing of colleagues to decide a close-fought leadership battle, the FT reports. Naoto Kan, prime minister, is facing a challenge from Ichiro Ozawa, known as the “shadow shogun”, in an election for party president that concludes on Tuesday. The contest could make Mr Kan the shortest-lived of a long line of “revolving door” Japanese premiers. Mr Kan, who took office in June, is much more popular with the public and looked almost certain to have secured most of the postal votes of DPJ local assembly delegates, members and supporters who account for more than 30 per cent of the voting points used to decide party leadership contests. However, analysts said Mr Ozawa might still prevail among the 412 DPJ members of the national Diet who account for the remaining almost 70 per cent of voting points, clearing the way for the veteran powerbroker to become Japan’s sixth prime minister in four years. Read more
With the S&P 500 up nearly 4 per cent in two days, commodities prices firming, better-than-expected economic data, and core bond prices under pressure, some analysts are (already) seeing a rebound in risk appetite. Indeed, if US non-farm payrolls data for August — due later on Friday — reassure markets, as expected, the risk bulls will probably come out in full force.
All the more curious, then, that the “safe-haven currency”, the yen, is still riding strong, down from last week’s 15-year highs of nearly Y83 to the dollar but still hovering around Y84.38 — despite Japan’s latest political turmoil, constant threats of currency intervention by officials and lacklustre economic data. Read more
Naoto Kan, Japan’s prime minister, and the contender for his job sought to portray each other as relics of the stagnant politics their Democratic party has vowed to transform when they squared off in a nationally televised debate on Thursday, the FT reports. The decision by Ichiro Ozawa, the party heavyweight, to challenge Mr Kan in a leadership election this month has cast doubt on the government’s economic and diplomatic policies and prompted speculation the party could break apart. Read more
Last ditch efforts to patch up differences between Japan’s prime minister and a powerful Democratic party rival failed on Tuesday, setting the stage for a leadership challenge that could split the ruling party, reports the FT. After a meeting with Naoto Kan, prime minister, DPJ heavyweight Ichiro Ozawa insisted he would contest an election for party leader scheduled for September 14. Mr Ozawa’s bid to oust Mr Kan, who in June became Japan’s fifth new prime minister in less than four years, throws into doubt the DPJ-led government’s economic policy just as the nation’s recovery from its worst post-war recession appears to be at risk. Read more
Ichiro Ozawa, an influential politician in the ruling DPJ, on Thursday decided to challenge prime minister Naoto Kan for the premiership, reports the FT. Ozawa, a former secretary-general of Kan’s DPJ, surprised political observers on Thursday with his move, since the man known as the “shadow shogun” is still dogged by a political funding scandal that forced him to leave his previous post. FT Alphaville notes the latest twist is like “the re-run of a kabuki play”. Read more
This is getting to be like an interminable rerun of a kabuki play.
Barely two months after one change of government and (yet another) dose of political paralysis in July, Japan is at it again. Read more
How much is a Japanese prime minister worth to investors and markets? Not that much, it would seem, FT Alphaville says, after Yukio Hatoyama became the fourth Japanese leader to resign in four years. Japanese government bonds and USD/JPY traditionally don’t react strongly to the country’s political personalities. Read more
Yukio Hatoyama on Wednesday said he would quit as Japan’s prime minister just eight months after his Democratic party swept into power, reports the FT. Ichiro Ozawa, the DPJ’s influential secretary-general, would also step down, Hatoyama said. Naoto Kan, finance minister, and Seiji Maehara, infrastructure minister, were seen as possible replacements. The moves follow clashes between Hatoyama and his party’s Social Democratic partner over the relocation of a US military base. The yen fell on the news, reaching Y91.37 to the dollar on Wednesday from Y90.94 on Tuesday. Read more