Speaking to CNBC’s Squawk Box on August 13th, Japan Optimist Jesper Koll outlined thoughts on the recent unwind of the yen carry trade that helped rock global markets last week.
Key Takeaways:
Healthy Market Correction: Jesper Koll views the recent market correction as a positive shift, forcing investors to focus on Japan's real economic strategy rather than short-term gains from carry trades.
Focus on Japan's Domestic Economy: The key to Japan's strategy lies in corporate restructuring and sustained real wage growth, emphasizing the domestic economy over speculative investments.
Impact of Yen Depreciation: Koll highlights that every 10 yen of depreciation adds about 8% to Japanese corporate profits, a significant factor in the recent earnings growth.
Repricing of Yen's Impact: As the yen stabilizes, the earnings growth driven by its depreciation is being repriced, but current corporate budgets anticipate a yen-dollar exchange rate around 145, suggesting no immediate negative impact.
Comments