Japanese financial markets experienced a significant surge as Sanae Takaichi was elected the new leader of the ruling Liberal Democratic Party (LDP), setting the stage for her to become Japan’s next prime minister. The Nikkei 225 index soared by over 4%, surpassing the 47,000 mark for the first time in history. Takaichi, a pro-business politician, is renowned for her advocacy of increased public spending and reduced borrowing costs. Her admiration for former UK Prime Minister Margaret Thatcher and her free-market economic policies have further bolstered investor confidence. Following her victory in the LDP leadership race, shares in real estate, technology, and heavy industry sectors saw notable gains. However, the Japanese yen plummeted to a record low against the euro and dropped by more than 1.5% against the US dollar. If confirmed as the successor to Shigeru Ishiba later this month, Takaichi will make history as Japan’s first female prime minister. She faces the daunting tasks of revitalizing a sluggish economy, addressing rising household costs, and fostering wage growth. Additionally, Takaichi will need to manage the complex US-Japan relationship and finalize a tariff agreement with the Trump administration, a deal initiated by the Ishiba government.