This week, Japan's Nikkei Stock Index reached the 40,000 threshold for the first time in three months due to a weaker Yen. The yen reached a new 37-year low in the upper 161 range against the U.S. dollar, bolstering exporters.
Why is Nikkei 225 increasing?
Recent data shows that the US Dollar reached its highest level since December 1986, reaching 161.74 yen, creating the major buying factor for Japan's stock market. Speculation has been that U.S. inflation could accelerate if former President Donald Trump returns to office and implements additional corporate tax cuts, resulting in fiscal expansion.
The benchmark 10-year Japanese government bond's yield increased by 0.025 percentage points from Monday's close to 1.085 percent as investors sold the debt in anticipation of increased inflation and rising U.S. long-term rates in the event of a second Trump Presidential term.
