Japanese stocks reached a record high in response to Prime Minister Sanae Takaichi’s spending plans, although significant challenges remain for the Asian giant’s new leader.
Takaichi has promised a “proactive” fiscal expansion, including boosting defense spending. But she will first face tough tests with Japan’s biggest trading partners: Takaichi meets US President Donald Trump this week, with analysts warning that Washington could increase tariffs again if she fails to see through her predecessor’s plans to invest hundreds of billions in the US.
Meanwhile, China has given Takaichi the “cold shoulder” over her recent meeting with the leadership of Taiwan, which Beijing claims as a renegade province.
