Japan's embattled Prime Minister Shigeru Ishiba has announced his resignation. Photo: AP PHOTO

Embattled Japanese Prime Minister Shigeru Ishiba has resigned, ushering in a potentially lengthy period of policy paralysis at a shaky moment for the world's fourth-largest economy.

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Ishiba, 68, announced his decision at a press conference on Sunday.

Since the former defence minister came to power less than a year ago, his coalition has lost its majorities in elections for both houses of parliament amid voter anger over rising living costs.

Shigeru Ishiba is president of the ruling Libera

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