Overview

• Ishiba said he will stay on as caretaker and will not run in the leadership contest triggered by his resignation.
• The ruling coalition lost its majority in both chambers of the Diet, capped by a July upper house setback after an earlier loss in the lower house, an unprecedented blow for the LDP since 1955.
• He framed the timing of his exit around securing a U.S. deal that lowers tariffs on Japanese autos to 15% and limits many other levies to that level.
• The LDP plans to vote on October 4, with declared or likely contenders including Toshimitsu Motegi, Sanae Takaichi, Shinjiro Koizumi and Yoshimasa Hayashi.
• Financial markets flagged the uncertainty as the yen weakened against the dollar and euro and long-dated Japanese yields stayed elevated, with investors assessing candidates’ fiscal and monetary stances.