Since mid-July, the Japanese stock market has entered a stage of high volatility, during which a series of uncertain factors such as the rate hike of the Bank of Japan, the violent fluctuation of the yen exchange rate and the "Trump deal" ushered in the US election. From the perspective of the Japanese stock market, if the Trump administration brings reflation and the appreciation of the US dollar, then Japan will face greater pressure of capital outflow.Economic slowdown will continueFrom the perspective of stock pricing logic, it is inseparable from corporate profits and risk premiums, both of which are inseparable from the fundamentals of economic growth. Going back to the fundamentals of Japan's economic growth, we can see that GDP growth is slowing down. Generally speaking, it is diff

Japan's political scene has been shaken by a sudden earthquake, with the ruling Liberal Democratic Party (LDP) losing its governing position for the first time since 2009, and Shigeru Ishiba's dream of becoming prime minister being snuffed out just a month ago.Although he has not been in power for a long time, Prime Minister Ishiba Shigeru's "black money" scandal is now in full swing, and the news about the irregular use of the LDP's political funds has greatly reduced the LDP government's support in the polls.Last weekend, the 50th House of Representatives election, in the 465 seats, the Liberal Democratic Party 191 seats, the Komeito party 24 seats (the two parties formed a ruling coalition of 215 seats, not reached a majority of 233 seats); the Constitutional Democratic Party 148 seats,

My points:”I believe that short-term fluctuations may have reached a bottom, there could still be similar volatility in the medium to long term. This is especially true given the Federal Reserve's expected interest rate cuts and the Bank of Japan's gradual approach to raising interest rates.However, the current interest rate of 0.25% by the Bank of Japan remains the lowest globally, and they have indicated a slow path towards increasing rates. It is reasonable to expect that there will be further yen carry trade closures and associated market pressures in the future.Perhaps in similar situations, we might not need to panic and rush to sell or short-sell; it could also be a good opportunity to buy on dips.The market performance in recent days has precisely illustrated this point. It suggest

As the Japanese yen exchange rate hit 160 in the early morning of April 29, marking a new low not seen in over 34 years, the Bank of Japan may have started to take action. Since April 29 is not a trading day in Japan (Showa Day), trading was relatively thin, resulting in larger intraday volatility. $iShares MSCI Japan ETF(EWJ)$ $Japanese Yen - main 2406(JPYmain)$ $Invesco CurrencyShares Japanese Yen Trust(FXY)$ What are the impacts of the yen's depreciation?Depreciation FactorsMonetary Policy Unchanged: The Bank of Japan decided at its March meeting to maintain the current bond purchase scale without announcing a reduction in bond purchases. This indicates tha

The monetary surprise last week came not from the ECB or the Federal Reserve, but from the Bank of Japan. In monetary terms, the Bank of Japan has gone further than the other two central banks in recent years. Where those two banks fixed the quantity (of bonds to be bought), the Bank of Japan (BoJ) fixed the price. So then, as a central bank, you are obliged to buy up everything on price. As long as a central bank has credibility, the market will usually do the job for you. But in December, the BoJ decided to raise the price ceiling from 0.25 per cent to 0.50 per cent. Since Kuroda, who shaped this policy, left in March, it was expected that the policy would be abolished soon. This has taken longer than expected. The Yield Curve Control (YCC) policy was unsustainable because it had become

With the end of the New Year holiday, the rebound atmosphere throughout January began to fade gradually. Although the market performance has not changed greatly in the past two weeks, the situation seems to be brewing slowly. After the expected interest rate hike this week, whether the Federal Reserve will give a new direction to guide the market in the next stage will be particularly crucial.According to FedWatch data, the Federal Reserve will announce a 25 basis point interest rate hike on February 1, which is also in line with previous mainstream market expectations. Since nothing unexpected can happen, the focus naturally turns to whether there is anything new in the attitude of Fed officials. Following the path of previous resolutions, the key to balancing interest rates (the extent a

The US dollar $USD Index (USDindex.FOREX)$ has maintained a downward trend recently.  In early January 2023, the scale of hedge funds' shorting of the US dollar has hit a one-and-a-half-year high.US Dollar Shorts Become Favorite Trade as the growing view that the Federal Reserve will slow the pace of interest-rate hikes is likely to keep selling pressure on the US currency.While the US dollar continued to fall, many non-US currencies have recently rebounded. Data from the Commodity Futures Trading Commission shows leveraged funds have cut yen shorts to the lowest level since February 2021. They also trimmed bearish bets on the Aussie while switching to net longs on the New Zealand dollar.The strong dollar ends？In