Japan’s ruling Liberal Democratic Party and the Japan Innovation Party have reached a broad agreement to form a coalition government, paving the way for the country to see its first female prime minister, Kyodo News reported on Sunday.
According to the report, LDP leader Sanae Takaichi and Ishin chief Hirofumi Yoshimura are expected to formally sign their coalition pact on Monday.
Yen is a little stronger on the news over the weekend.
USD/JPY is around 150.40.
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The background to all this is that the LDP elected Sanae Takaichi as its first female leader and likely next prime minister two weeks ago. She has since had difficulty in gaining required coalition support though. The yen was trashed on her election, she is a supporter of further fiscal support and loose monetary policy. As her path to PM had become obstructed, though, the yen recovered some ground.
It's a bit of a limited bid for the yen in the early hours given Takaichi is perceived as negative for the yen.
