Japan's Prime Minister Abe will potentially...>

JAPAN: Japan's Prime Minister Abe will potentially call a snap election next

month, Abe feels his support has increased following his poise during the N.

Korean crisis, his approval ratings have recovered to 50% in recent polls, up

from 30% in July surveys. This recovery came after an early August cabinet

reshuffle which was said to boost Abe's popularity. The Nikkei reported the main

opposition group "is mired in turmoil, with multiple members reportedly looking

to defect" which makes this a good time for Abe to prey on their vulnerability.

Abe suffered a hefty defeat at the recent election for the Tokyo assembly in

July, overtaken by a new party formed by Tokyo's Governor Yuriko Koike but

analysts see the possibility of this being repeated as remote. As part of his

Abenomics policy the Bank of Japan have embarked on a massive QQE policy under

the guidance of BoJ Governor Kuroda. If the snap election were to result

negatively for the LDP party it could cast doubt on the BoJ's current programme,

especially with rumours abound of a new BoJ Governor to replace Kuroda when his

current term ends in April 2018. The strength of any (potential) Abe win could

also have consequences related to the planned increase of sales tax next year.