Takaichi's Approval Ratings Plummet Amid Fiscal Policy Concerns

Japanese Prime Minister Sanae Takaichi's approval ratings have hit their lowest point since she took office last year, amid rising inflation and a weak yen. The prime minister's support for fiscal stimulus and criticism of higher interest rates has heightened investor concerns about Japan's public finances.

Takaichi's strong advocacy for expansionary policies has made it difficult to talk down speculative bets against the yen, with government sources warning that markets are gaining control over fiscal management. Bond yields have risen to three-decade highs in July on concern over Japan's worsening finances.

The prime minister acknowledged the need for transparent communication with markets and stressed her determination to break Japan's 'excessive fiscal tightening' with big investment. However, analysts say her policies themselves won't change much, leaving little hope for improvement in bond markets.