Aug. 29 (Bloomberg) -- Japan’s opposition led in three public opinion polls ahead of tomorrow’s lower-house elections, which may end the ruling coalition’s half-century hold on power.

Support for the Democratic Party of Japan rose 3.3 points from last week to 35.9 percent for proportional-representation seats, a Kyodo News poll showed, and 1.9 points, to 36 percent, in single-seat constituencies. The Diet comprises 300 members elected in single-seat constituencies and 180 through each party’s share of the national vote.

The DPJ, led by Yukio Hatoyama, may win more than 300 seats, up from the 112 it holds now, the Yomiuri newspaper said. A Mainichi newspaper poll showed support for the opposition party at 44 percent, down from 45 percent. Voter preference for Prime Minister Taro Aso’s Liberal Democratic Party rose 3 points to 21 percent, the Mainichi reported yesterday.

The polls coincided with a government report yesterday showing Japan’s unemployment rate rose to a record in July, signaling households are unlikely to help sustain a recovery from the country’s worst postwar recession. The jobless rate advanced to 5.7 percent, eclipsing the previous high of 5.5 percent in April 2003, the statistics bureau said in Tokyo.

“The DPJ is trying to sell themselves as a fiscally responsible party, rather than a big spender,” said Naka Matsuzawa, chief investment strategist at Nomura Securities Co. in Tokyo. “The DPJ, at least for some time after the election, will stay on the course of fiscal austerity,” he said in an interview yesterday with Bloomberg Television.

Impact on Yen

A win by the Democrats is unlikely to affect the yen in the short term, said Daniel Tenengauzer, head of foreign-exchange strategy in New York at Bank of America-Merrill Lynch.

“There is very limited room for whoever wins the elections to actually do something” that affects the currency, Tenengauzer said in an interview yesterday with Bloomberg Television. The dollar rose against the yen in New York trading yesterday, climbing 0.1 yen to 93.62 to the dollar as of 3:21 p.m.

The fight between Aso and Hatoyama involves two of Japan’s political dynasties: Hatoyama’s paternal grandfather, Ichiro, was the founder and first prime minister of the LDP, and took power from Aso’s grandfather, Shigeru Yoshida.

Family Traditions

The Tokyo-born Hatoyama, 62, is a fourth-generation lawmaker and his mother is the eldest daughter of the founder of Bridgestone Corp. of Tokyo, the world’s biggest tire maker. Aso, 68, is the great-great-grandson of Toshimichi Okubo, a founder of the Meiji government that overthrew the last shogun.

Kyodo questioned 1,229 eligible voters Aug. 26 and 27. The Yomiuri telephone poll of 85,777 people was conducted Aug. 25- 27, and Mainichi polled 1,026 people Aug. 26 and 27. None of the news organizations gave a margin of error.

The LDP gained 1.4 percent, to 17.9 percent, in proportional representation, Kyodo said, and rose 3.8 percent, to 22.6 percent, in single-seat constituencies.

Aso’s support rose to 23.6 percent from 18.5 percent, and 22.7 percent of respondents said he was most suited to be Japan’s leader, up from 19.5 percent, Kyodo said. Support for Hatoyama remained almost unchanged at 48.7 percent, according to Kyodo.

The LDP has also gained in some constituencies, according to the Yomiuri, with the number of “closely fought” seats rising to 67 from 53 in a poll conducted Aug. 18-20.

To contact the reporter on this story: Stuart Biggs in Tokyo at sbiggs3@bloomberg.net.

Last Updated: August 28, 2009 16:24 EDT