TD Securities anticipates a landslide victory for the LDP in Japan's upcoming Lower House election, which is expected to restore a stable political environment. The report warns that investors should be cautious of potential FX intervention if USD/JPY breaks above 160.
"We expect the LDP to win by a landslide this weekend, achieving an absolute majority in the Lower House which ushers back a stable political environment."
"Investors will be on the lookout for MoF's FX intervention if USDJPY breaks >160 as MoF may take advantage of thinner liquidity during Japan holiday on the 11th Feb."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)