The organization also cut its growth forecast for Japan, citing the need for additional fundamental reforms to support economic growth and an outline to diminish the budget deficit. Year-to-date, the WisdomTree Japan Hedged Equity Fund (NYSEArca: DXJ), which tries to hedge against a weakening Japanese yen, has declined 9.1% and the iShares MSCI Japan ETF (NYSEArca: EWJ), which is exposed to currency risks, decreased 8.0%.
Additionally, the OECD placed its largest downgrade on Russia. The Russian economy is estimated to expand 0.5% this year, compared to the previous forecast calling for a 2.3% growth, as “the moderate recovery that was under way at the end of 2013 has been halted by the turbulence related to the events in Ukraine,” according to the OECD. The Market Vectors Russia ETF (NYSEArca: RSX) has plunged 22.5% year-to-date. [Russia ETFs Slide After S&P Downgrade]
In an unusual fashion, the OECD suggested that the European Central Bank’s refinancing rate “should be reduced to zero” from 0.25% as a way to kick start inflation.Iif the ECB does decide to take a looser stance on monetary policies, the WisdomTree Europe Hedged Equity Fund (NYSEArca: HEDJ) would benefit from a weakening euro currency and an expanding economy. HEDJ is up 2.1% year-to-date. [Europe ETFs for Possible ECB Quantitative Easing]
For more information on global markets, visit our global ETFs category.
Max Chen contributed to this article.