Japanese PM Fumio Kishida to Step Down as Ruling Party Leader

Japanese Prime Minister Fumio Kishida will step down as ruling party leader in September. His term, marked by rising prices and political scandals, will end, triggering a contest for his successor. The new leader will face economic and geopolitical challenges, including managing the fallout from COVID-19 policies.

Japanese Prime Minister Fumio Kishida will step down as ruling party leader in September, media reported on Wednesday, concluding a three-year term characterized by rising prices and political scandals.

Kishida, who saw his public support wane, has chosen not to seek re-election as the Liberal Democratic Party (LDP) leader. The decision will prompt a contest to replace him, potentially altering Japan's leadership dynamics as the world's fourth-largest economy faces key challenges.

Kishida's tenure included guiding Japan through the COVID-19 pandemic with significant stimulus spending. He also appointed Kazuo Ueda to head the Bank of Japan, resulting in unexpected interest rate hikes that destabilized the stock market and weakened the yen.

Kishida shifted from corporate profit-driven policies to those aimed at boosting household incomes, including wage hikes and promoting share ownership. His departure will likely lead to tighter fiscal and monetary conditions, impacting risk-assets like equities.

(With inputs from agencies.)