Yen at Record Weakness: Opportunities for Tourists, Challenges for Investors
Driven by wide interest rate differentials with the rest of the developed world, the Japanese yen has weakened sharply against the US dollar, the Euro and other major currencies over the past few years.
July 9, 2024
In June, the yen hit JPY160.7 against the US dollar, its weakest level since 1986. For foreign tourists, this is a great opportunity to visit the Land of the Rising Sun for magnificent cuisine, culture and landscapes.
The story is not so great for foreign investors. Japanese equities and Japanese real estate assets have been performing well – in local currency terms. Foreign investors who have not hedged their currency exposure may be feeling pain.
The yen’s weakness also has implications for Japanese investment overseas. Japanese institutional and corporate investors became famously conservative about investment overseas after big Japanese companies wasted huge sums buying trophy assets in overseas markets at peak prices at the end of the country’s economic bubble in the late 1980s, after which Japan entered a 30-year economic downturn.
While Japan is the largest foreign holder of US treasury bonds (with total holdings of USD1.2 trillion as of January 2024), it is only in very recent years that Japanese demand for riskier foreign asset classes (listed equities, private equity and debt, real estate…) has shown signs of recovery. The yen probably needs to stabilise for this recovery to continue.
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Citicourt & Co Limited (“Citicourt”), has completed advising on the management buyout (“MBO”) of Arthur Murray International, Inc. (“Arthur Murray”), an international franchisor of dance studios. The 112-year-old company now counts 300 dance studios in two dozen countries across the globe. The MBO team was led by UK based Gary Edwards, an ambassador for Arthur Murray for the last 20 years, who will serve as CEO.
Citicourt & Co Limited (“Citicourt”), has completed advising on the management buyout (“MBO”) of Arthur Murray International, Inc. (“Arthur Murray”), an international franchisor of dance studios. The 112-year-old company now counts 300 dance studios in two dozen countries across the globe. The MBO team was led by UK based Gary Edwards, an ambassador for Arthur Murray for the last 20 years, who will serve as CEO.
Our CEO had the honour of being invited to 11 Downing Street and representing Citicourt & Co, as part of our continued support for the Royal Museums Greenwich, a nearly 350 year old organisation. Thank you for a wonderful evening and discussions all about fascinating 17th century Britain and Newton!
