Insights

Inbound consumption by overseas visitors to Japan continues to grow. For the nine-month period from January to September 2015, such consumption totalled a cumulative ¥2.6 trillion (approx. US$21.7 billion), which already represents a higher amount than that for all of 2014.

The IMF's decision to include the Renminbi into the SDR is a major push for the RMB to become one of the world's major reserve currencies.

Our lead Australian fixed income portfolio manager discusses her intermediate-term outlook for the bond market “down under.”

Once again, as has long been our view, disappointing macro-data should not worry investors in Japanese risk assets very much at all.

Prices of the US Treasuries (USTs) ended the month lower. Risk-on sentiment prevailed for the most part of October, favouring risk assets over perceived "safe-haven" instruments.

The MSCI AC Asia ex Japan Index rose 8.0% in USD terms, broadly in line with MSCI AC World Index. All Asia ex Japan currencies except the Philippine Peso strengthened against the US dollar in October.

Developed and emerging markets in Asia ex-Japan have clearly been under tremendous pressure in recent months, including redemptions of more than USD 50bn from the region in September, the heaviest ever witnessed.

We update our views on whether ECB QE has had a positive effect on corporate earnings.

There are many reasons for the BOJ to defy consensus expectations for more easing.

US Treasuries (USTs) registered gains in September. Yields initially trade in a tight range, but subsequently jumped mid-month, in anticipation of the announcement from the US Federal Reserve (Fed).

The MSCI AC Asia ex Japan Index was down 1.8% in USD terms in September which masked the volatility where the markets oscillated within a wide range of 10%.

There is an admirable effort to improve the female participation rate, but it is too early to judge whether the measures will have a major effect.

A better supply/demand balance in Europe, outperformance of “high yield“ globally, positive event-risk in the telecom sector and opportunities in local currencies, as well as other credit related investment themes, all present interesting opportunities for generating positive returns, even in a challenging environment.

Our Nikko Asset Management fixed income experts, led by Simon Down, discuss the prospects for commodity currencies.

In our view, the G-3 economies will fare reasonably well, and basically match the current consensus in the next few quarters; however, there will be significant challenges for each region.

For the time being, we are not estimating a date for reducing the Fed’s balance sheet, but a 2Q16 initiation seems quite logical at this stage.

Although we expected G-3 bond yields to rise, they did so less than we predicted in our June meeting. We expect yields to rise moderately further for the next two quarters.

Our forecasted macro-backdrop scenario has mixed ramifications for global equities, with the US declining but most other regions rising, and it is likely to be very volatile ride

Markets and economies are still being dictated to by unprecedented levels of monetary stimulus. We believe in building a portfolio of companies that are more likely to flourish in the growth environment beyond 2015.

US Treasury (UST) yield curve, along with other asset classes, experienced volatile swings in August. The Chinese central bank’s announcement that it would modify the approach to setting the CNY fixing midpoint effectively weakened the currency against the USD.