Japanese stocks reached a record high following the announcement of Sanae Takaichi as the new leader of the ruling Liberal Democratic Party (LDP), positioning her as a potential candidate for Japan’s next prime minister. The benchmark Nikkei 225 index increased by over 4% on Monday, surpassing 47,000 for the first time.
Takaichi is recognized for her advocacy of increased public spending and reduced borrowing costs. She has expressed admiration for former UK Prime Minister Margaret Thatcher and her approach to free market economics.
The market reacted positively to Takaichi’s victory in the LDP leadership race, with share prices rising across sectors including real estate, technology, and heavy industry. However, despite this stock market surge, the Japanese yen fell to a record low against the euro and decreased by more than 1.5% against the US dollar.
If confirmed as prime minister later this month, Takaichi would be Japan’s first female to hold the position, succeeding Shigeru Ishiba. She will face several challenges, including a sluggish economy and households that are experiencing higher living costs alongside slow wage growth.
In addition to domestic issues, Takaichi will need to manage the relationship between the US and Japan, particularly concerning a tariff deal established under the previous administration. Questions arise about how her policies will address these economic and diplomatic challenges, as well as their potential impact on domestic stability.
Source: https://www.bbc.com/news/articles/c20vljzgp0ro?at_medium=RSS&at_campaign=rss