Overview
- Prime Minister Sanae Takaichi’s Feb. 8 landslide and ruling coalition supermajority accelerated expectations for fiscal expansion and tolerance for a weaker yen.
- Japanese markets jumped as the Nikkei 225 set record highs above 57,000, the yen slid toward roughly 157 per dollar, and Japanese government bonds faced selling pressure.
- U.S. equities retreated over the past week, with the Nasdaq down about 5.6%, the S&P 500 off 2.7%, and the Russell 2000 lower by 2.6% as risk appetite cooled.
- Analysts report cross-asset de-risking in crypto, with Bitcoin tracking equity weakness, derivatives open interest falling into the mid-$20 billion range, and over $1 billion in leveraged longs liquidated during early-February stress.
- Near-term Bitcoin risks remain tied to global liquidity conditions, while Japan’s stated 2026 agenda on Web3, stablecoin rules, and tax updates is viewed as a potential longer-term positive.