Exit polls from a key election in Japan project the ruling coalition is set to lose its majority, putting the country's Prime Minister Shigeru Ishiba under immense political pressure. Voters headed to the polls earlier on Sunday for the tightly-contested election, being held amid public frustration over rising prices and the threat of US tariffs.

Japanese Premier Shigeru Ishiba vowed to remain in his post on Monday after his ruling coalition suffered a bruising defeat in upper house elections, prompting some in his own party to doubt his leadership as the opposition weighed a no-confidence motion.

A re-run of last summer’s turmoil where a rise in the Japanese yen caused chaos throughout financial markets is threatened by this weekend’s Japanese elections, a strategist warns.

Japan's embattled prime minister Shigeru Ishiba, fresh off a crushing defeat in upper house elections over the weekend, will not be in a position of strength to negotiate a favorable trade deal with the U.S., analysts said.

Its leader is a former supermarket manager who created his political party on YouTube in the depths of the coronavirus pandemic and campaigned on the Trumpian message “Japanese First.”

Japan’s relatively new Sanseito party won 14 seats in Sunday’s election, a sizable gain for the party. Its platform includes a "Japanese first" agenda.

The Bank of Japan will raise its key interest rate by at least 25 basis points by year-end, a majority of economists said in a Reuters poll, although that could be swayed by global trade tensions and domestic political uncertainty.