The new prime minister “has single-handedly changed the psychology of the yen’s exchange rate and set it on a potential fast track to depreciation,” says Jeremy Schwartz, director of research at WisdomTree Investments. [Japan ETFs: More Room for Yen Weakening?]
CurrencyShares Japanese Yen Trust (NYSEArca: FXY) has shed 12% the previous three months.
Specialized ETFs that invest in Japanese stocks but hedge their exposure to a weaker yen have been extremely popular lately. They include WisdomTree Japan Hedged Equity Fund (NYSEArca: DXJ) and db-X MSCI Japan Currency-Hedged Equity ETF (NYSEArca: DBJP). [Japan ETF Doubles in Size]
Later Wednesday, markets will get the Federal Reserve announcement on interest rates and the economy. The Commerce Department on Wednesday said U.S. gross domestic product fell at a 0.1% annual rate in the fourth quarter. [How ETFs Reacted to Negative GDP]
Vanguard MSCI Pacific ETF
