Yen Carry Trade Is Back on Radar After Likely Next PM Takaichi Jolts Markets

A once-popular currency trade betting against the yen looks set to make a comeback, as Sanae Takaichi’s near-certain elevation to Japan’s premiership raises the prospect of slower interest-rate hikes. Japan’s currency has dropped around 2% against its G-10 peers so far this week, as investors wagered that Takaichi’s pro-stimulus stance would result in a slower timeline for the Bank of Japan’s policy tightening. Delayed hikes could well tempt traders back into a strategy known as the carry trade, where the ...