How the yen might affect Japan’s stock market next year

The recent breakdown in the relationship between yen/dollar and the relative performance of stock markets in Japan and the US in local-currency (LC) terms makes it hard to predict how these stock markets will fare against one another if, as we envisage, the yen strengthens against the greenback again in 2025. Our best guess is that Japan’s stock market will underperform its US counterpart on this basis.

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