The yen’s sharp decline since last summer has fueled surging interest in DXJ. New Japanese Prime Minister Shinzo Abe is widely expected to drive the yen even lower in an effort to stoke inflation and assist the economy.
“Japan – the world’s third largest economy – has been battling deflation, or falling prices, for over 15 years. Kuroda has pledged to do ‘whatever it takes’ to raise the country’s inflation rate to 2.0% within two years,” the Mail & Guardian reports. “Although many economists doubt that this goal is achievable within such a short period of time, they do expect the BOJ to act aggressively under his leadership. With the BOJ’s overnight rate already at 0.1%, attention is focused on the central bank’s asset purchase programs.”
Yet investors were selling Japanese stocks Monday to take profits and on the belief that hopes for bold monetary easing are mostly priced into the market, said Makoto Kikuchi, the chief executive of Myojo Asset Management, in a Reuters story.
“That is not to say that sentiment is negative. People are still hopeful about easing, and we see some buying by long-term investors like pension funds that are raising their stance to ‘neutral’ from ‘underweight’ on Japan,” Kikuchi added.
WisdomTree Japan Hedged Equity Fund
