Prime Minister Shinzo Abe’s economic policies is helping to shift billions of dollars of government-controlled investments into the Japanese equities as the country pulls of out a deflationary environment and pushes the economy toward growth, reports Chikafumi Hodo for Reuters.
The Government Pension Investment Fund (GPIF), the world’s largest public pension with $1.26 trillion in assets, started investing billions more into stocks. Abe’s ruling party recently stated that it would change the GPIF’s staff to shift portfolio decisions. [Institutions Buy Japanese Stocks]
“Abe is trying to restructure the tax code and lower corporate tax rates to make Japan a more attractive place to do business. This should be good for corporate profits in the longer run. Expect more consumption tax hikes next year, pushing the rate to 10%, which will be offset by lowered corporate tax rates,” said WisdomTree Research Director Jeremy Schwartz in a note out earlier this month.
iShares MSCI Japan ETF
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of EFA.