Prime Minister Yoshiro Mori's ruling coalition suffered painful losses in Japan's lower house election Sunday, holding onto power but dropping enough seats to weaken its ability to guide the nation.
The three-party coalition led by Mori's Liberal Democratic Party kept its majority in the 480-member chamber, and LDP leaders quickly claimed a mandate for its fiscal stimulus program to spend Japan's lackluster economy into recovery.
"The result means that we've received the approval from the public," LDP Secretary-General Hiromu Nonaka told national broadcaster NHK. "Therefore, it's only natural for Mr. Mori to stay as prime minister."
However, the LDP lost its single-party hold on the majority, making it more dependent on two coalition partners who were also badly damaged in the election.
The results called into question the alliance's ability to push key legislation through the powerful lower house of Parliament and fueled speculation that the LDP would try to jettison the unpopular Mori after Japan hosts the G-8 summit in July.
Kyodo News agency reported that LDP chieftains would meet later today to endorse Mori as premier and discuss forming the next government.
Mori also reportedly planned to convene Parliament on July 4.
Major gains were posted by the LDP's top competition, the opposition Democratic Party. Unofficial tallies of votes by NHK and Kyodo showed the party boosting its representation by more than 30 percent.
"We couldn't have done better," an ecstatic Yukio Hatoyama, leader of the Democrats, told reporters.
The coalition, which campaigned on promises to keep up a massive fiscal spending program, had been widely expected to garner a majority in the election despite rock-bottom support ratings for Mori's Cabinet.
The Home Affairs Ministry was still counting some ballots early today and official final figures were not immediately available. But NHK reported that the coalition won 271 seats in the lower house. That would give it control of 56 percent of the chamber down sharply from the 65 percent controlled before the vote.