Mizuho Securities noted that the weekend election in Japan could increase market expectations for greater government spending, leading to a tendency for the yen to weaken. "A decisive election victory is likely to strengthen market anticipation of proactive fiscal policy in the near term, thereby stimulating short-term selling of the yen," said Chief Trading Strategist Shoki Omori. In the medium term, the yen's movement will depend on the interest rate differential between the U.S. and Japan, as well as how the government's fiscal credibility is reflected in the term premium.