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UBS: Fiscal policy limitations may lead to high market trading Close Position and affect support rates.
Jin10 data, October 21: UBS economist Masamichi Adachi stated that the challenges faced by Prime Minister Kishi include rising prices, additional budgets, diplomatic priorities, and reducing the number of seats in the House of Representatives according to the protocol reached with the Restoration Party. Her upcoming policy speech may clarify her “responsible active fiscal policy.” The market focus is on the impact of the budget proposal on the fiscal deficit; excessive measures could trigger a dumping of Japanese assets, while measures that fall short may lead to Kishi's trading Close Position and affect her approval ratings.