Fed-Japan Currency Intervention Yields Unexpected Gains for DXJ

The Bank of Japan (BOJ) and the Federal Reserve coordinated their efforts to prop up the sagging yen, which was hovering around four-decade lows. This unusual move involved the BOJ intervening in currency markets, a strategy they've used before, but this time with the added support of the Fed.

The WisdomTree Japan Hedged Equity Fund (DXJ) took advantage of the situation and notched an impressive 3% weekly performance. As a currency hedged ETF, DXJ benefits when the dollar is strong against the Japanese currency, which means it wins on the back of yen losses.

Japan's economy has been experiencing a robust picture, with strengths such as a substantial GDP surplus and declining net debt relative to its GDP. However, the country's economic performance has been overshadowed by the negative attention surrounding the yen's weakness.