Japan gets a new defence minister, yen unmoved - Rabobank

Michael Every, Head of Financial Markets Research at Rabobank, notes that the Japan’s PM Abe appointed a new defence minister, Tomomi Inada, a controversial, hawkish right-wing nationalist.

Key Quotes

“It seems unlikely Mrs Inada will ease already-high tensions in the region following the recent South China Seas ruling. (Again it’s over to Kenneth Williams, sadly.)

Yet markets once again shrugged all of this off, as they would usually do with the bland ‘dog bites man’ August stories we are more used to seeing at this time of year. Indeed, equities edged higher in many places even as long bond yields in Japan rose once again (40-years are now up 35bp in the last 4 trading weeks to 0.43%); in FX, JPY trod water around the 101 level for most of the day while the broad USD index rose from around 95.0 to 95.5.”