Outlook on Japan: October 2023

Lazard's Outlook series provides a forward-looking view, over the short, medium, and/or long term, of asset classes, sectors, regions, or countries from the view of Lazard Asset Management. In this edition, LAM portfolio managers share their outlook for Japan in Q4 2023. 

Summary

• With an unexpected move to widen yield curve control in July, the Bank of Japan has begun carving a path to policy normalization, and we expect more adjustments to come.
  
  
• Recent changes in the behavior of Japanese consumers and companies indicate to us that a shift away from a deflationary mindset is underway, a very positive development for the economy.
  
  
• Modifications to the Nippon Investment Savings Account (NISA) are imminent and may encourage savers to invest in risk assets, resulting in more demand for Japanese equities over time.
  
  
• In light of these changes and ongoing corporate governance reforms, we are very optimistic on Japanese equities in the medium and long term and would view a market pullback in the short term as a potential opportunity for investors.

Click here to read our Outlook on Japan for Q4 2023.