Japan's financial markets are reeling under a triple whammy this week, with stocks, bonds, and the yen all nosediving as investor anxiety spikes over the country's fiscal stability. The chaos comes just months after new Prime Minister Sanae Takaichi took office, with markets signaling skepticism about her government's ability to tackle Japan's debt mountain while maintaining ultra-loose monetary policies. 💸
Last week saw the Nikkei 225 plunge over 3%, erasing $127 billion from Tokyo-listed stocks in a selloff that Bloomberg called 'the worst since the pandemic.' Bond markets mirrored the panic, with 10-year government yields hitting 1.8%—a 17-year high—as traders bet against Japan's capacity to manage its world-leading debt burden. 📊
Analysts blame the meltdown on a perfect storm: fears of expanded fiscal spending, prolonged low interest rates, and global hedge funds doubling down on 'Sell Japan' strategies. With the yen also sliding to fresh lows, young investors are scrambling to adjust portfolios. 🚨 'This isn't your grandparents' Japan trade,' warned one Tokyo-based finfluencer trending on TikTok.
