Japanese Policy Hurts Hong Kong

The Japanese central bank has disclosed that it would begin to increase the buying of their government bonds and invest into different stocks and this information had a positive impact on the Japanese economy. The bank intends to increase the money supply in Japan, and its value against the dollar has dropped while its shares have seen a 1.6% increase. While Japan is seeing changes in its country, cities from neighboring countries such as Hong Kong is also seeing an affect due to this news. Many investors are now swaying to invest in Japan, dropping the amount of investments occurring in Hong Kong.

Though it is good for the Japanese economy that investors are now more willing to invest in Japanese stocks, the impact that their new policies have on the global economy should be put first. Since every country’s economy is so closely related, the fall of Hong Kong’s stocks and stocks from other neighboring countries may end up bouncing back at them in the end.

Written by: Jessica Ho
Source: The Wall Street Journal

http://online.wsj.com/article/SB10001424127887323646604578404161692943512.html?mod=WSJ_Heard_LEFTTopNews

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