China clearly holds the crown among Emerging Market Equity markets when it comes to attracting fund flows this year. In the struggling Developed Market universe, meanwhile, Japan is breaking free of the pack. Japan Equity Funds have recorded inflows 11 of the past 12 weeks, and Japan Dividend and ESG Funds have done even better with flows to the former picking up significantly in mid-March and those to Japan ESG Funds lofting off at the start of February. Yet, the lag in response to increasingly rosy market conditions and the minimal changes that Global and Global ex-US Funds have made to their Japanese exposure, hints at a degree of skepticism.

In this episode, Research Associate Kirsten Longbottom and Director of Research Cameron Brandt invite Pictet Asset Management's Senior Portfolio Manager Jon Withaar to discuss these themes and trends.

We look back at 2015 when the corporate governance code was introduced, discuss the current, relatively cheap valuations of Japanese assets, explore what bad inflation looks like for Japan, examine the linkages between Japan and China in the long term, ask where the Bank of Japan will go from here and delve into the benefits of a weak Yen versus strong Dollar.

More from EPFR on Japan:

• Aug 6, 2023 Quants Corner: An unusual visitor comes knocking on Japan’s door. Did it RSVP?
• Jan 27, 2023 Off the Wire: Japan government bonds: Is there a coming outflow?
• Feb 3, 2022 Paper: A rising tide lifts some (Japanese) boats: The Bank of Japan’s ETF purchases and their impact on market signals for individual stocks

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