Japan's Stocks Soar to All-Time Peaks In the Wake of Appointment of Business-Friendly Leader
Japan's stocks have hit a all-time high following the country's governing Liberal Democratic Party appointed the pro-business politician as its new leader, paving the way for her to become Japan's next leader.
The benchmark Nikkei 225 index rose by approximately four and a half percent on Monday in the capital, after rising past 47,000 for the first time ever.
She, who has held high-ranking positions including minister for economic security and internal affairs, is known for her support of higher public expenditure and lower interest rates.
She is also a longstanding supporter of former British leader the Iron Lady and her free market approach to the economy.
Investor Response and Economic Effects
Investors welcomed the news of her win in the party leadership contest, with stocks rising in property, tech and heavy industry companies.
Although Japanese stocks rose, the yen reached a historic low against the European currency and dropped by 1.7% against the US dollar.
Monday's reaction was mostly a "immediate response" to the potential selection of the leader as prime minister, an economist Jesper Koll told.
Although her economic plans to boost the economic growth through higher public outlays could help companies, they may additional pressure on the yen as Japan's debt increases, noted the economist.
Leadership Change and Challenges
Should confirmed later this month as the replacement to the outgoing leader, she will be the nation's first female leader.
Mentored by former Prime Minister Abe, she has championed his policy framework - called Abenomics - of high government expenditure and cheap lending.
Should confirmed in the position, Takaichi will have to manage a difficult bilateral relationship and see through a tariff deal with American leader Donald Trump administration, which was earlier negotiated by the Ishiba government.
She would also have to address a sluggish economic growth and households grappling with higher costs and stagnant income increases.
As Trump scheduled to travel to the country soon, Mr Koll said Takaichi will be keen to discuss a fresh deal with the American leader "to get the US currency weaker and to get the yen stronger."
