Japanese candidate Koizumi promises ¥1 million average wage gains

Shinjiro Koizumi, the reform-minded candidate seeking to lead Japan’s ruling party, laid it all out on Saturday in Tokyo that he plans to raise average wages by ¥1 million in five years.

That’s $6,760 more in annual pay for workers across the country. Koizumi said the plan would kick off immediately after taking office, and it includes cutting fuel taxes, rewriting the income tax code, and using new revenue to drive growth.

He also wants a massive ¥135 trillion worth of new investments into Japan by 2030. He is going for direct tax changes and a total overhaul in how the government pulls in and spends money.

“We have to act now,” Koizumi said. “We’re already behind.” According to Bloomberg, he’s rolling out these proposals just weeks before the official LDP campaign starts on September 22. Voting happens on October 4.

Koizumi challenges Takaichi with tax and wage overhaul

Shinjiro isn’t the only one with plans. His main rival, Sanae Takaichi, pitched her platform the day before, leaning hard into stimulus spending.

Both are pushing sharp economic agendas, but Koizumi’s angle focuses more on structural reform and hard targets. With the leadership vote only weeks away, the policy clash between the two is setting the tone for what could be a sharp shift inside the party.

While politics were heating up, the Bank of Japan held its ground on Friday. It kept the interest rate at 0.5%, exactly as economists in a Reuters poll had predicted.

Japan’s Nikkei 225 index, which had been on a hot streak, fell 0.57% by the close, finishing at 45,045.81. Earlier that day, the index hit another record high. At the same time, the yen gained 0.14% against the dollar, settling at 147.80.

August inflation numbers were released too. Core inflation hit 2.7%, the lowest level since November 2024. That made it the third month in a row it’s gone down. Headline inflation also landed at 2.7%, a drop from 3.1% in July.

Both numbers came in exactly where economists expected. Hiroaki Amemiya, investment director at Capital Group, said the central bank was staying cautious and keeping flexibility open: “By preserving policy optionality, the BoJ is signaling its readiness to respond to external volatility.”

Bonds surged, with the yield on Japan’s 2-year government bonds rising to 0.885%, the highest level since June 2008, based on LSEG data. The broader Topix index also dipped, closing down 0.35% at 3,147 on Friday.

Across Asia, market results were mixed. Australia’s ASX/S&P 200 went up 0.32% to 8,773.5, while South Korea’s Kospi fell 0.46% to 3,445.24. The smaller Kosdaq index jumped 0.7%, ending at 863.11. In Hong Kong, the Hang Seng Index stayed flat at 26,545.1, and China’s CSI 300 barely moved, ending at 4,501.92.

One major player in China’s mining sector made headlines too. Zijin Gold, part of Zijin Mining, filed for an HK$25 billion IPO in Hong Kong. They’re offering nearly 349 million shares at HK$71.59 each. Trading is set to begin on September 29.

In India, the Nifty 50 slid 0.55%, but Adani Enterprises spiked over 4%. That came after India’s market regulator cleared the Adani Group and Gautam Adani of some of the misconduct allegations raised by Hindenburg Research.

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