Global Market Stabilizes as Japan and US Intervene in Yen Trade

The global market has seen significant shifts in performance this month, with the Go Global investment strategy outperforming Stay Home so far. Korea and Taiwan are leading the pack, both up over 5% in dollar terms, with South Africa a close third. The US Treasury's intervention in the yen market has had little impact on overall financial markets.

Last week, Japan and the US jointly purchased yen for the first time since 1998, following its steep decline to nearly 164 yen per dollar. This move was seen as a response to fears that Japan would be forced to sell US Treasuries to support their currency. However, Treasury Secretary Scott Bessent emphasized that 'you can give market signals with intervention, but it's policy that turns it.'

The global financial markets have shown little concern over the potential unwinding of the yen carry trade, despite discussions surrounding this issue. The performance rankings for August show Korea and Taiwan at the top, followed closely by South Africa. China and Hong Kong lag behind, with Brazil holding the bottom spot at -3.6%. In year-to-date numbers, Korea has seen an impressive 70.8% increase, while Taiwan has gained 62.3%, with EM ex-China trailing behind.