Yen’s Malaise Deepens as Capital Outflows Eclipse Record Surplus
- Investment outflows provide important steer on yen’s outlook
- Lack of opportunities in Japan are keeping money overseas
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Brisk capital outflows from a slow-growing Japanese economy are deepening depreciation pressure on the yen.
Many yen watchers see the still-wide interest-rate gap between the nation and the US as explaining the currency’s persistent weakness, especially given likely inflationary policies from President-elect Donald Trump. Less visible, yet just as influential, are trade and investment flows in and out of Japan.