Japanese PM Ishiba Steps Down After Tough Election Defeats

Japanese Prime Minister Shigeru Ishiba has quit his job, taking the blame for his party's big losses in recent elections. This shake-up leaves Japan's politics – and its economy, the world's fourth biggest – in a bit of a mess, especially with money troubles and global tensions already in the mix. 

Ishiba, who's 68 and only took over about a year ago, told his Liberal Democratic Party (LDP) to quickly pick a new leader. The LDP has run things in Japan for ages, but his team lost control of both houses of parliament. People are fed up with prices going up on everyday stuff like food and bills. 

Key Highlights

• Japanese PM Shigeru Ishiba resigns after election defeats, LDP faces leadership battle 

• Japan’s political shake-up rattles markets as Ishiba steps down amid economic woes 

• Sanae Takaichi and Shinjiro Koizumi emerge as contenders to replace Ishiba as PM 

Still, Ishiba can point to one win: he wrapped up a major trade deal with the U.S. that brings in $550 billion in investments. That should help shield Japan's car industry from tough new tariffs pushed by President Donald Trump. Looking teary-eyed, Ishiba said, "We've cleared a big obstacle with this agreement. Now it's time to hand things over to someone fresh." 

The pressure had been building, especially after the LDP got hammered in the upper house vote back in July. Experts like Kazutaka Maeda from the Meiji Yasuda Research Institute say it was just a matter of time. Who might step up? Sanae Takaichi, a tough-on-money conservative who almost beat Ishiba last year, is in the running. Or maybe Shinjiro Koizumi, the young farm minister who's good at charming crowds and tackling high food costs. Takaichi wants to spend more freely, which could spook stock markets, while Koizumi might keep things steady. 

Also Read: Trump Approves US-Japan Trade Deal Order, Imposes 15% Baseline Tariff

Markets are already jittery – the yen's down, and long-term government bonds took a hit last week, with the 30-year yield reaching an all-time high on Wednesday. Folks are worried a new boss might loosen the purse strings too much. 

Ishiba also flagged worries about neighbors: a big military show in Beijing with leaders from China, Russia, and North Korea. As Japan deals with all this, business bigwig Yoshinobu Tsutsui from Keidanren said, "We can't afford to drag our feet." 

Ishiba stays on until a new leader's chosen, but for now, Japan's watching closely.