Japanese Politics Updates – June 8, 2025

Opening Highlights

• • Yen rebounds slightly, but pressures persist
    The yen closed at ¥144.86 to the dollar on Friday, a slight strengthening amid mixed global signals. The U.S. labor market contraction, BoJ hesitation, and ongoing U.S.–China trade tensions contribute to exchange-rate volatility. ¥142 ~ ¥150 is projected as the range for Q2.

• • PM Ishiba’s calendar dominated by domestic pressures
    After a frenzy of foreign visitors tied to the Osaka Expo these last couple of weeks, the Prime Minister’s attention now shifts to policy crises at home. Inflation, rice prices, potential Diet dissolution are on the table while he is fending off an increasingly vocal opposition.

• • Rice crisis and agricultural reforms steal headlines
    Rice stockpile depletion and spiking prices force the government to release older reserves and convene emergency meetings. The appointment of Shinjiro Koizumi as Agriculture Minister is seen as a bold political play.

• • Double election speculation intensifies
    With just 12 days left in the current Diet session and Tokyo Metropolitan elections looming, Ishiba has threatened to dissolve the Lower House preemptively if the opposition attempts a no-confidence motion. A dual Upper/Lower House election on July 22 remains on the table.

• • Emperor and Empress visit Okinawa ahead of WWII anniversary
    The imperial couple, accompanied by Princess Aiko, visited Okinawa in recognition of the 80th anniversary of the war’s end. The visit recalled the island’s wartime suffering and the staggering civilian casualty rate during the Battle of Okinawa.

• • South Korea elects progressive new president
    Following the impeachment of President Yoon, a center-left candidate narrowly won after a 60-day campaign. Policy changes on North Korea and trilateral relations with Japan and the U.S. are expected.

• • Trump tariffs still unresolved — clock ticking
    Minister Akazawa returned from his fourth round of U.S. negotiations with little to show. A resolution is hoped for at the upcoming G7 in Alberta. However, July 9 remains the hard deadline before suspended tariffs snap back into place.

Main Briefing 

We opened today’s session from the gently rocking deck of Gryms, docked in Katsuyama, where the June drizzle mirrored the political mood in Tokyo — unsettled, with storm clouds forming on the horizon.

The yen ended the week at ¥144.86 to the dollar

This is a moderate recovery that nonetheless underscores deepening concern about inflation and the economy. With the U.S. posting weaker-than-expected jobs data and the BoJ maintaining a cautious stance, markets are jittery. Most economists expect the yen to stay within the ¥142–150 range this quarter, with occasional surges depending on global trade friction and investor appetite for risk.

Rice: at the heart of this week’s domestic news

The government is now grappling with a shortfall in rice available on the market as prices surge, igniting criticism from both farmers and consumers. The emergency release of stockpiled rice — some of it four years old — and a push for reforms at JA (Japan Agricultural Cooperatives) signal a serious effort to stabilize the market. Prime Minister Ishiba’s appointment of Shinjiro Koizumi as Agriculture Minister raised eyebrows. He is  a media-savvy but polarizing figure, whose experience may not match the complexity of the current crisis. Some interpret this as a strategic move to shift blame, others as a test of Koizumi’s ability to grow beyond sound bites. Overall, however, seen as a good move by PM Ishiba.

Meanwhile, speculation continues to build over a potential double election

With just 12 days left in the Diet session and Tokyo Metropolitan Assembly 9 day campaigning beginning on Friday, June 13, the window is narrowing. PM Ishiba’s recent comment that he might dissolve the Lower House if faced with a no-confidence motion was not made lightly. Should he do so, Japan could face a full double election on July 22. This is a rare but constitutionally possible scenario. Internally, the LDP is split on the strategy. Some within the party feel emboldened by polls showing a weak opposition. Others are concerned about fatigue, scandal-hangover, and voter volatility.

The diplomatic calendar was lighter this week, though significant. 

On the international stage, attention turned to the Emperor and Empress’s visit to Okinawa — their first in over a decade. The visit, which included Princess Aiko, was solemn, marking the 80th year since the end of WWII and the immense human cost of the Battle of Okinawa. The island saw over 200,000 Japanese deaths, including 94,000 civilians (1/3rd of the island’s population!). The imperial visit resonated deeply in the region. It renewed discussions about base relocation, generational trauma, and Japan’s pacifist legacy. Please keep in mind U.S. casualties were 183,000: astoundingly, 6.8% in death, 26.8 wounded/missing; even more so, Japanese forces suffered ~100% casuality. 

In South Korea, the political landscape shifted dramatically 

Following the election of a new progressive president, succeeding Yoon Suk-yeol’s impeachment, Lee Jae-myung (61 yo) from the Democratic Party with 49% of the vote, is now President. The campaign was fast and bitter, and the result will likely complicate trilateral defense cooperation. Japanese officials are bracing for possible reversals on export controls, North Korea policy, and joint exercises — particularly if nationalist rhetoric resurfaces in Seoul.

US – Japan trade tensions remain unresolved

Minister Ryosei Akazawa returned from Washington without a firm agreement on the Trump-era tariffs. The tariffs are due to reimpose automatically on July 9 unless a final accord is reached. Talks with U.S. Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnoclk and USTR Jamieson Greer reportedly hit roadblocks over autos, digital trade and agricultural quotas. All eyes are now on the G7 Finance Ministers’ meeting in Alberta next week. It’s likely the last realistic chance for resolution before the tariffs snap back and Japanese exports take a hit.

Overlaying all this is the continued erosion of public confidence

Recent polling shows the Cabinet approval rate down to 30.3%, with disapproval now at 55.6%. These are the worst numbers of the Ishiba Administration to date. Inflation continues to bite. Ishiba is broadly praised for his energy and statesmanship. Yet, there is growing unease about his government’s ability to deliver economic relief. The opposition is sensing an opportunity. It continues to weigh a no-confidence motion, though internal divisions may prevent it from materializing before the session ends. A new poll is being conducted this weekend. Some expect an uptick in voter appreciation due to the Koizumi wind. Let’s see next weekend.

Q&A Highlights