Japan is on a roll

Politics aside, things are looking up for Japan [View in browser]( [Bloomberg]( Welcome to Balance of Power, bringing you the latest in global politics. If you haven’t yet, sign up [here](. Prime Minister Fumio Kishida spent large parts of today being grilled by a [parliamentary ethics committee]( in Tokyo. Yet for all the inherent political drama, the spectacle of a bland premier seeing his support slide due to a finance scandal rocking the long-ruling Liberal Democratic Party is nothing new for Japan. What is new is that the country’s main stock index is at lofty levels never seen before. Advanced semiconductor plants are opening, tourist arrivals are surging and there are more jobs available than applicants to fill them. Japan is back, and enjoying a global moment. After years of a stagnating economy and deflation, global funds are pouring into Japan, turning the nation’s shares into top performers over the past year, while the weak yen is offering a tailwind and boosting exporters. The Nikkei hit a record last week, joining Wall Street in pushing into uncharted territory. Even the Bank of Japan looks ready to make a change and is poised to raise interest rates in the coming months for the first time since 2007. Chronic problems remain, notably massive government debt and the costs of supporting a rapidly aging population. Factory output fell the most in January since the height of the pandemic. Kishida’s days as premier may be numbered ahead of a September election for leadership of the LDP, which despite regular scandals has ruled almost continuously since its founding in 1955. Political turmoil hasn’t prevented Japan from betting big on a return to its high-tech heyday, especially in the key [semiconductor sector](. In contrast to its behind-schedule US operations, TSMC of Taiwan [opened a new fab]( this month in Kumamoto, with another to come. Its politics can’t mask the fact that things are looking up for Japan. — [Jon Herskovitz]( WATCH: Bloomberg’s Peter Elstrom interviews Hisashi Kanazashi, the Economy, Trade and Industry Ministry’s key player for Japan’s semiconductor policy. Source: Bloomberg Global Must Reads Ukrainian officials are concerned Russian advances could gain significant momentum by the summer unless their allies can increase the supply of ammunition, a source says. Kyiv’s internal assessments of the battlefield situation [are growing increasingly bleak]( as Ukrainian forces struggle to hold off Russian attacks while rationing the number of shells they can fire. Vladimir Putin warned of the potential for a [nuclear confrontation]( with the West over his war in Ukraine. The Russian president said Kyiv’s US and European allies “have to understand that we also have weapons that can hit targets on their territory,” in an address today to lawmakers and top officials in Moscow. Age is becoming one of Joe Biden’s biggest challenges as he bids for reelection in November. Eight in 10 voters in key US swing states said the president, 81, [is too old](, a new Bloomberg News/Morning Consult poll found. That’s almost double the share that said the same about his likely Republican opponent, Donald Trump. Iran’s parliamentary elections tomorrow are being watched at home and abroad [as a test of public support]( for the government’s handling of protests and role in the ongoing Israel-Hamas war. Turnout in the Islamic Republic is set to be a more important metric than the results themselves due to the sidelining of moderate factions and absence of conventional political parties. Campaign placards yesterday in Tehran. Photographer: Fatemeh Bahrami/Anadolu/Getty Images Venezuela set new conditions for elections this year, [flouting a US-brokered agreement]( and potentially triggering tougher sanctions by Washington. The move comes amid increased repression of the opposition, which has included banning their leading candidate María Corina Machado from taking part in the election and the arrest of activist and defense lawyer Rocío San Miguel. The US Supreme Court decision to take up Trump’s bid for immunity from criminal prosecution may mean a trial to hold him accountable for trying [to overturn the 2020 election]( could face a lengthy delay, potentially until after the November election. Voters go to the polls today in a special election in northwest England that’s [likely to stir political tensions]( over the Israel-Hamas war. Ghana’s lawmakers passed a bill that seeks up to three years in prison for people identifying as LGBTQ, becoming the latest African nation after Uganda to [pass draconian laws]( aimed at the community. Washington Dispatch Biden and Trump will each attempt to [seize the narrative over immigration]( today with separate visits to the US-Mexico border. The issue has taken on greater urgency in the minds of voters as a surge in crossings has taxed the resources of cities and states far from Mexico and Canada. Both candidates will be holding their events in Texas — Biden in Brownsville and Trump in Eagle Pass. The former president has vowed to enact hardline border policies as he ramps up pressure on Biden, promising that he would carry out the largest deportation of undocumented immigrants in US history and complete a wall along the southern border. Biden has said that only Congress can fully address the situation on the border, and his camp believes Republicans are now on the defensive over immigration after Trump killed the bipartisan immigration deal. In an indication of how the migration question has weighed on leaders in Ottawa as well as in Washington and Mexico City, Canada will reimpose visa requirements for many travelers from Mexico to help curb the waves of asylum seekers arriving at airports, a source says. One thing to watch today: The personal consumption expenditures price index and data on personal income and spending will be released. [Sign up for the Washington Edition newsletter]( for more from the US capital and watch Balance of Power at 5pm ET weekdays on Bloomberg Television. Chart of the Day In the same week that S&P Global Ratings predicted sovereign debt issuance will balloon this year to about $11.5 trillion, more than 50% above its pre-pandemic level, Group of 20 finance chiefs meeting in Sao Paulo seem far keener to talk up the world economy’s outlook. The draft communique has the [fewest mentions]( of “debt” and associated words in years. And Finally Chief Warrant Officer Joey Temple, a senior targeting officer at the US 18th Airborne Corps, wasn’t interested when he was first approached with a demo of Maven, a [system built around powerful algorithms]( intended to identify personnel and equipment on the battlefield. But now he’s a believer. Today artificial intelligence is helping the US military locate Houthi rocket launchers in Yemen and surface vessels in the Red Sea, and narrow targets for strikes in Iraq and Syria. America isn’t alone: Ukraine is employing AI software to help it battle Russia’s invasion, and Israel says it’s using it in the Gaza offensive. A keepsake in Temple’s office. Photographer: Cornell Watson for Bloomberg Businessweek More from Bloomberg - [Bloomberg Opinion]( for a roundup of our most vital opinions on business, politics, economics, tech and more - [Next Africa](, a twice-weekly newsletter on where the continent stands now — and where it’s headed - Check out our [Bloomberg Investigates]( film series about untold stories and unraveled mysteries - [Economics Daily]( for what the changing landscape means for policy makers, investors and you - [Green Daily]( for the latest in climate news, zero-emission tech and green finance - Explore more newsletters at [Bloomberg.com](. Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. 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