The Link Between Cheap Yen and Japan Stocks Rally Completely Breaks Down
- Correlation gauge between currency and shares at nearly zero
- Strong yen can actually boost profit margins: Astris Advisory
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The long-held precept that a weak yen is a good thing for Japanese stocks may finally be put to rest, as the breakdown in their correlation accelerates amid divergence in global monetary policy.
Since its big summer crash, the Topix has been stuck in a narrow trading band even as the yen has swung between a 14-month high of 139.58 per dollar in mid-September and a mid-November low of 156.75, which was not far from its 38-year trough in July.