Yen Pointers From Nikkei
The ‘big’ GPIF announcement has come and gone, and USDJPY watchers are still none the wiser as to when the big structural reforms can materialise. By panel Chair Ito’s own admission, the process could take ‘years’ and several major institutions would need to adopt significant changes. As such, it is safe to assume that significant outflow from these entities may not be on the horizon in the near future, yet Japanese equities have shown more resilience of late and the yen is holding up. In addition the Nikkei is now a leading force behind the Abenomics trade. Domestic factors continue to disappoint, but the ability of external flow and macro drivers to generate self-fulfilling prophecies can always surprise.
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