Japan’s Takaichi Faces Market Tests From Yen to Stocks and Bonds

Markets have lost their enthusiasm for Japan’s new Prime Minister Sanae Takaichi, with about $127 billion wiped off the value of Tokyo-listed stocks over the past week and sharp declines in the yen and government bonds.

While consumers have reason to cheer her for embarking on the biggest round of extra spending since the pandemic, investors are worried that Japan may be spending beyond its means. They are also expressing concerns that the Bank of Japan looks less likely to increase interest rates soon to tamp down inflation.