Sanae Takaichi has made history as Japan's first female prime minister following a coalition agreement between the long-ruling Liberal Democratic Party and the reformist Japan Innovation Party. Her election triggered a surge in investor optimism, sending the Nikkei 225 to a record high, briefly topping 49,900 points. Takaichi's early policies include proposed tax cuts, higher defence spending, and restarting nuclear energy - moves aimed at revitalising Japan's sluggish economy. She has ruled out a snap election, instead focusing on a stimulus package to tackle the cost-of-living crisis. Markets responded positively, with the 'Takaichi trade' underpinned by expectations of structural reforms and greater political stability.