Commentary: Japan’s Political Turmoil Puts Markets on Edge
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On Sept. 7, Japanese Prime Minister Shigeru Ishiba decided to resign, citing a desire to avoid division within his party. Ishiba’s Liberal Democratic Party-led ruling coalition had lost its majority in the House of Representatives in October 2024 and the House of Councilors in July 2025, and he had been facing internal pressure to step down. Recently, several cabinet ministers publicly called for an early party presidential election. On Sept. 8, the LDP is set to hold a meeting to decide whether to advance the election. According to interviews by NHK, more than 130 of the LDP’s 295 Diet members already support holding an early party presidential election. Facing mounting internal pressure, Ishiba ultimately chose to concede.
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- October 2024：
- The Liberal Democratic Party-led ruling coalition lost its majority in the House of Representatives.
- July 2025：
- The Liberal Democratic Party-led ruling coalition lost its majority in the House of Councilors.
- August 2025：
- Japan’s consumer price index rises 2.7% year-over-year and the CPI excluding food and energy is up 1.5% year-over-year.
- September 7, 2025：
- Prime Minister Shigeru Ishiba decided to resign, citing internal party division.
- September 8, 2025：
- The Liberal Democratic Party plans to hold a meeting to decide whether to advance the party presidential election and is expected to announce the election timeline and open candidate registrations.
- September 2025：
- The party will need opposition support to pass the fiscal 2025 supplementary budget.
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