Japan is entering a period of political uncertainty following an Oct. 27 election where the ruling Liberal Democratic Party and its junior partner lost their majority in parliament for the first time since a vote in 2009. The yen tumbled to a three-month low in the immediate aftermath as investors braced for a weaker administration. A 30-day clock was also set in motion for a new government to emerge, pitting the LDP against the main opposition Constitutional Democratic Party to build a majority, or find a route to a minority government.
It takes 233 votes in the powerful lower house of parliament to form a government. The center-right LDP and partner Komeito now have 215. The opposition camp and all non-affiliated lawmakers have 250 — with the CDP having the highest tally among that group with 148 seats. The CDP, which bills itself as centrist, has indicated it wants to try and cobble an unlikely majority coalition among opposition groups that include the Communist Party on the left, and the Japan Innovation Party — or Ishin — a right-leaning party with roots in Osaka politics that favors small government. The LDP could potentially reach a majority with the addition of one of the mid-sized opposition parties.