TOKYO, April 26 A Japanese court on Thursday
acquitted ruling party heavyweight Ichiro Ozawa of charges of
violating fund-raising law, further complicating Prime Minister
Yoshihiko Noda's task of preserving party unity and pushing
through his contentious tax hike plan.
If upheld, the Tokyo district court decision could help the
69-year old former party leader, who opposes Noda's plan to
double the sales tax and leads the party's biggest faction,
contest the scheme and challenge Noda's leadership.
But analysts said the threat of an early election may
prevent Ozawa's backers from revolting against the prime
minister, and that the fate of the tax bill rested primarily in
the hands of the opposition which controls the parliament's
Still, bond investors will be watching Ozawa's next steps
for any signs that increased infighting among the ruling
Democrats could further delay budget reforms necessary to rein
in Japan's snowballing debt.