Japan's new Prime Minister has asked the Bank of Japan to
introduce "unlimited" easing in order to weaken the currency,
make exports competitive and pull Japan out of its deflationary
During its recent meeting, BOJ doubled the inflation target to
2% but decided to start "open-ended" asset purchases next
In a recent survey conducted by WSJ, most economists opined
that Shinzo Abe's election will be good for the Japanese
Yesterday while lowering the growth estimates for the
Euro-zone and some other countries, IMF left the forecast
for Japan unchanged at 1.2% for this year, while cutting the
2014 prediction to 0.7%.
IMF chief economist Blanchard said "Fiscal expansion is going
to help growth in the short run, …at the same time when you start
with such a level of debt and without a medium term credible
fiscal consolidation plan, increasing the fiscal deficit in the
short run is a very risky thing to do."
Looking at the
tracking Japan, it appears that the market believes that the
policy measures may be successful. While the ETF tracking the
broader equity market iShares MSCI Japan Index Fund (
is almost unchanged in the last one month, MSCI Japan Index Fund
) which provides exposure to Japanese stocks without any exposure
to the currency is up 3.8% during the same period.
Do you think that Japan can finally turn around after a "lost"
decade or rather decades?
WISDMTR-J HEF (DXJ): ETF Research Reports
ISHARS-JAPAN (EWJ): ETF Research Reports
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