Japan's Liberal Democratic Party scored a decisive victory in the December 14 parliamentary election, with voters demonstrating their approval of Prime Minister Shinzo Abe's macroeconomic policy agenda.

Last April, Japan's government implemented a long-planned consumption-tax hike, from 5 per cent to 8 per cent, and is expected to bring the rate to 10 per cent by 2015.

The US Federal Reserve's gradual exit from so-called quantitative easing - open-ended purchases of long-term assets - has financial markets and policymakers worried, with warnings of capital flight from developing economies and collapsing asset prices dominating policy discussions worldwide.