BOJ-Fed Intervention Boosts Japan ETF Amid Yen Weakness

The Bank of Japan (BOJ) and the Federal Reserve coordinated to prop up the yen, which has been hovering around four-decade lows. This intervention is unusual, as it's the first time since 1998 that the Fed helped the BOJ support the Japanese currency.

The WisdomTree Japan Hedged Equity Fund (DXJ), a currency-hedged ETF, notched an impressive weekly performance of roughly 3% last week. Given its design to benefit when the dollar is strong against the yen, DXJ's success comes as the yen weakens.

Experts suggest that the BOJ and Fed intervention may be driven by concerns about a weak yen putting pressure on other Asian currencies, including China's. A weak yen could also hinder efforts to reindustrialize the US, according to the Council on Foreign Relations.