Takaichi’s agenda faces tradeoffs as Hormuz crisis continues

KEY TAKEAWAYS

• The Takaichi government has continued to avoid committing to modifying its response to the Hormuz crisis, but pressure is mounting as the crisis continues
• Prime Minister Takaichi Sanae may be resisting a supplemental budget to protect her pursuit of national rejuvenation through fiscal expansion, but rising inflation and borrowing costs could put her in a difficult position.