Equity Research

Japan's Upper House election resulted in a small loss of the majority held by the ruling coalition (Liberal Democratic Party + Komeito), which attained 47 seats of the 66 up for re-election, taking its total number of seats in the Upper House to 122 (majority line: 125). As of writing, Prime Minister Shigeru Ishiba has expressed his intention to remain in his position. Therefore, we think a minority government of the current LDP-Komeito coalition is likely to continue. However, as the ruling coalition no longer has a majority in the Upper or Lower Houses, cooperation with opposition parties on a bill by bill basis is likely to become even more crucial for passing legislation.