Japan's Long Recovery

An excerpt from our First Quarter 2024 Investment Brief: 

The Japanese economy and financial markets experienced three major milestones in the first quarter. After more than three decades, the Japanese equity market finally recouped the peak level it attained in 1989, when a massive equity and real estate bubble burst. Second, the Bank of Japan (BoJ) signaled victory in its decades-long fight against deflation with an increase in its policy rate and other steps to tighten liquidity conditions. Finally, the yen reached a 34-year low against the U.S. dollar, notwithstanding the BoJ’s policy shift. In this Special Topic, we discuss these milestones and assess the prospects for Japanese equities.