Intriguing RV graphs: What persistent inflation concerns suggest
Key points
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Considering Lower House election polls, market likely pricing in outcome in which LDP secures outright majority (or ruling coalition secures majority)
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Despite recent yen appreciation, market’s inflation expectations have not declined; meanwhile, limited strengthening of concerns about fiscal deterioration
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Could be reflecting market view that inflationary pressures difficult to avoid, even if LDP wins and fiscal deterioration can be avoided