Japan’s deputy economy minister said he’s confident the nation’s economic recovery will be seen in share prices after next month’s elections.
“I’m optimistic and expect the strength of the Japanese economy will be reflected in the stock market,” Yasutoshi Nishimura, 50, said yesterday in an interview in Tokyo. Markets are likely to “positively rate the government’s policies after the upper house elections once they see how determined we are to implement them.”
Victory for the Liberal Democratic Party-led coalition in the ballot planned for July 21 would end a split parliament that has slowed the passage of bills. The government’s task will then be to ensure its growth strategy — the third of the three Abenomics arrows after monetary and fiscal stimulus — produces a sustained recovery in the world’s third-largest economy.
The Nikkei 225 Stock Average (NKY) hit a high of 15,942.60 on May 23, up more than 80 percent from mid-November last year. The benchmark was at 13,135.52 at 10:07 a.m. in Tokyo today.
The release of the mid-term fiscal outlook in August should help stabilize bond yields, Nishimura said. The yield on the benchmark 10-year bond was at 0.87 percent today, after tripling from a record low of 0.315 percent to as high as 1 percent since April.
Nishimura said concerns over the direction of the Chinese economy and the U.S. Federal Reserve potentially slowing its bond-buying program have been a cause of market turbulence in Japan.
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