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US fund managers hesitant on yen despite undervaluation

Created at 22 Jul · 5:10 PM1 source↑ Market-relevant
IN SHORT

U.S. institutional investors view the Japanese yen as undervalued but are holding back from buying due to uncertainty over Japanese officials' policy actions to support the currency.

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Key Numbers

39-yearyen low against USD

Who's Involved

U.S. institutional investors
hesitant to buy undervalued yen
Japanese officials
expected to take policy action to support yen
US fund managers hesitant on yen despite undervaluation

↳ Why This Matters

Investor sentiment and potential policy interventions regarding the Japanese yen can impact global currency markets and carry trade dynamics.

Key facts

  • The Japanese yen hit a 39-year low against the U.S. dollar on July 22.
  • U.S. institutional investors consider the yen to be significantly undervalued.
  • Investors are hesitant to invest in the yen due to a lack of clear policy action from Japanese officials.

Despite believing the Japanese yen is significantly undervalued, many U.S. institutional investors are reluctant to purchase the currency. Their hesitation stems from a wait-and-see approach, as they await clear policy actions from Japanese officials aimed at safeguarding the yen. The yen reached a 39-year low against the U.S. dollar on July 22.

Frequently asked questions

They believe the yen is undervalued but are waiting for clear policy actions from Japanese officials to support the currency.

The Japanese yen reached a 39-year low against the U.S. dollar on July 22.

They view the yen as significantly undervalued.

What Happens Next

01Japanese officials may announce policy actions to support the yen.

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Cadence
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How It Developed

The Japanese yen reached a 39-year low against the U.S. dollar on July 22.
U.S. institutional investors believe the yen is undervalued.
Investors are reluctant to buy the yen, awaiting clear policy action from Japanese officials.

Sources

T1
US fund managers shy away from 'significantly undervalued' yenNikkei Asia

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