Takaichi keeps Katayama, Motegi and Koizumi in first Cabinet reshuffle

Prime Minister Sanae Takaichi is due to reshuffle her Cabinet on 17 September 2026 and keep the three posts that markets and allies watch most closely. Government sources told Kyodo and Reuters that Finance Minister Satsuki Katayama, Foreign Minister Toshimitsu Motegi and Defence Minister Shinjiro Koizumi will stay. Chief Cabinet Secretary Minoru Kihara is also expected to remain.

The first reshuffle since Takaichi took office in October 2025 is being sold as continuity. Katayama handled a rare joint yen intervention with US Treasury Secretary Scott Bessent in late July. Keeping her is a signal that exchange-rate policy will not be rewritten for the sake of a new face. Motegi and Koizumi both lost to Takaichi in the last Liberal Democratic Party leadership race. Leaving them inside the Cabinet keeps those rivals on the government payroll and off a backbench platform.

The first Ishin minister

Hiroshi Nakatsuka, formerly secretary general of the Japan Innovation Party, is expected to take a combined brief covering regulatory reform, administrative reform and children’s policy. That would be the first Cabinet seat for the LDP’s junior coalition partner, known as Ishin. Takaichi needed Ishin to become prime minister. Giving the party a portfolio now ties it to the bills that go to the extra Diet session in October.

Internal Affairs and Communications Minister Yoshimasa Hayashi is the loose piece. Party sources said the question is which job, if any, he takes next. Hayashi also ran against Takaichi. Where he lands will show how much room she is willing to give a third former rival.

On 16 September she had already reshuffled LDP executives and again chose continuity. Taro Aso stayed as party vice president. His brother-in-law Shunichi Suzuki stayed as secretary general. Takayuki Kobayashi stayed as policy chief. Hiroshi Kajiyama replaced Haruko Arimura as head of the General Council. Hideki Murai took Kajiyama’s old job as Diet affairs chief. Kazuhiko Aoki replaced Junichi Ishii as upper-house secretary general after Ishii’s poor working relationship with the prime minister became part of the public account of legislative stalls.

The session the new lineup has to carry

An extraordinary Diet session is expected to open around 5 October. Two files sit at the top. The first is a plan to cut the consumption tax on food and drink from 8 percent to 1 percent for two years from April. The second is a political-reform bill to reduce the number of Diet seats, a measure that triggered an opposition boycott in the last session.

Yomiuri reported that Minoru Kiuchi, a reflationist ally, is likely to stay as economic revitalisation minister. Reuters read that as evidence Takaichi does not intend to shrink her spending plans to calm markets. The yen intervention in July bought time. It did not settle the argument about how much extra outlay the bond market will absorb if defence and tax cuts move together.

Defence is the other pressure. Separate reporting on 16 September said the Defence Ministry is considering a target of about 52,000 unmanned systems in the five years from fiscal 2027, with more than 9 trillion yen pencilled for stand-off weapons. Those numbers belong to a year-end rewrite of the security documents. They still hang over a Cabinet that is being asked to look unchanged.

What “no change” is for

A reshuffle that keeps Katayama, Motegi, Koizumi and Kihara is a message to three audiences. Markets get the same finance minister who sat across from Bessent. Washington and regional capitals get the same foreign and defence ministers. LDP factions get the reminder that last year’s runners-up work for the winner.

The risk of that design is rigidity. If the food-tax cut or the seat-reduction bill fails in October, Takaichi cannot blame a new team. She will own the lineup she chose to freeze.

For 17 September the personnel list is the news. The first test of it arrives in three weeks, when the extra session opens and the tax bill is no longer a talking point.