Intervention by the Japanese authorities to weaken the yen has failed to prop up the country’s ailing stock market. Admittedly, the slide in equity prices has been due to renewed concerns about the eurozone rather than to doubts about the benefits of a cheaper currency to Japan’s exporters. But we think the yen will strengthen significantly against the dollar again soon. Accordingly, Japan’s stock market is likely to continue to underperform its US counterpart. We expect the Nikkei 225 to end next year at 8,200 from a little over 8,800 now. (We forecast the S&P 500 to end 2012 around 1,200.)
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services