Japan's Stocks Surge to All-Time Peaks After Selection of Business-Friendly Leader
Japanese stocks have hit a all-time high following the country's governing LDP appointed Sanae Takaichi as its new leader, positioning her to be Japan's next prime minister.
The key Nikkei 225 index was up by around 4.5% on Monday in Tokyo, after rising past forty-seven thousand for the first time.
Takaichi, who has served in senior government roles including economic security minister and internal affairs, is known for her advocacy of higher government spending and reduced borrowing costs.
She is additionally a long-time admirer of former UK leader the Iron Lady and her market-oriented approach to the economy.
Market Response and Financial Effects
Investors welcomed the news of her victory in the LDP leadership race, with shares rising in real estate, tech and industrial companies.
While Japanese stocks gained, the yen reached a historic low against the European currency and dropped by one point seven percent against the American currency.
The day's reaction was mostly a "immediate response" to the possible appointment of Takaichi as the nation's leader, Japan economist an expert commented.
Although her economic plans to boost the economy through higher public outlays could help businesses, they may further weaken the currency as Japan's debt increases, said the economist.
Political Transition and Issues
Should confirmed later this month as the replacement to Shigeru Ishiba, she will be Japan's first woman leader.
Guided by late leader Abe, she has championed his policy framework - called Abenomics - of increased public spending and cheap lending.
If confirmed in the role, Takaichi will have to manage a difficult bilateral ties and see through a trade agreement with US President Trump's administration, which was previously agreed by the Ishiba government.
She would also have to contend with a slow economy and families grappling with rising expenses and stagnant income increases.
With the US president scheduled to travel to Japan later this month, Mr Koll said she will be eager to negotiate a fresh deal with the American leader "to get the dollar weaker and to strengthen the Japanese currency up."
