(Adds comments)

TOKYO (Reuters) -Sanae Takaichi is likely to be Japan’s first female prime minister after winning the race on Saturday to lead the ruling Liberal Democratic Party.

The former internal affairs minister, a conservative nationalist with an expansionary agenda, is expected to replace Prime Minister Shigeru Ishiba since the LDP is the largest in parliament.

Below are comments on the outcome:

NAOYA HASEGAWA, CHIEF BOND STRATEGIST, OKASAN SECURITIES, TOKYO

“The chance of the Bank of Japan’s interest rate hike later this month has weakened. The market will initially react to the outcome of the LDP election by buying bonds with mid-term maturities and selling super-long dated bonds. So the curve will steepen.

“The market saw a more than 60% chance for the BOJ’s rate hike to 0.

See Full Page