Is The Yen Carry Trade Propping Up The S&P 500?

With the Fed and BOJ set to meet this week, investors should be alert to the possibility of an abrupt yen reversal and its impact on global markets.

U.S. dollar banknote with map

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The Japanese yen’s weakness, despite narrowing interest rate spreads, suggests that carry trades are being redirected into US equities, creating potential instability if the Bank of Japan shifts its policy stance. With both the Fed and BOJ set to meet this week, investors should be alert to the possibility of an abrupt yen reversal and its impact on global markets.
 

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