Market observers argue that the greenback will maintain its momentum as more traders anticipate the Federal Reserve to hike interest rates 25 basis points in December, especially after minutes from the Fed’s September policy meeting released on Wednesday revealed many members leaning toward higher borrowing costs on improving U.S. economic conditions.
Some Abe advisors have said the Bank of Japan and the government could combine further monetary easing with more public spending, the Wall Street Journal reports. The central bank holds over a third of outstanding government debt.
“There’s another reason to like Japanese small-caps now: They’re reasonably priced. As of the end of August, Glover calculated that they traded at a 16% discount to Japan’s large-caps and a 39% discount to U.S. large-caps relative to earnings. They were less than half as expensive as U.S. small-caps,” according to Barron’s.
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WisdomTree Japan SmallCap Dividend Fund (NYSEArca: DFJ)