Yen in Crisis: Takaichi's Election Gamble Sparks Fiscal Fears, Intervention Doubts

• Japan's yen faces a crisis of confidence due to Prime Minister Sanae Takaichi's snap election campaign focusing on expanded stimulus measures.
• Authorities are hinting at market intervention, but experts like Toshinobu Chiba doubt its long-term impact due to investor distrust in Japan's fiscal control.
• Japan's government debt is 230% of GDP, the highest in the developed world, exacerbating fears of a fiscal blowout.
• Takaichi's pledge to suspend the consumption tax on food, a 5 trillion yen revenue source, without a clear replacement plan, raises concerns.
• Past interventions, like in 2024, showed limited success in reversing the yen's decline, highlighting the challenges of sustained currency support.

Why It Matters: Takaichi's election promises and Japan's high debt fuel yen's crisis, raising doubts about intervention effectiveness.