Recent tensions erupted after Japanese Prime Minister Sanae Takaichi suggested Tokyo might take military action if Beijing invaded Taiwan.

Japanese Prime Minister Sanae Takaichi faces mounting pressure to soften her stance on Bank of Japan policy and unveil an economic package with a credible funding plan as the yen and government bonds lose ground ahead of her meeting with BOJ Governor Kazuo Ueda.

The package is based on three pillars: addressing rising prices, achieving a strong economy, and strengthening defense and diplomatic capabilities.

In response to rising inflation, Japan's Prime Minister Takaichi's cabinet approved a 21.3 trillion yen stimulus package.

Japanese people gather in front of the prime minister’s official residence on November 21, 2025 to protest against Sanae Takaichi’s erroneous remarks concerning Taiwan. Photo: Courtesy of Risa Shirasaka

Japan's parliament elected Sanae Takaichi as the country's first female prime minister Tuesday, after her party struck a coalition deal expected to pull her governing bloc further to the right.

Japan’s longer-maturity sovereign bonds tumbled further Tuesday as investor worries deepened that a big economic package from Prime Minister Sanae Takaichi would damage the nation’s public finances.

Close aides to Japanese Prime Minister Sanae Takaichi have expressed concern about her round-the-clock approach and the lack of downt