MAB Growth Quarterly Review Q4 2025 - Flipbook - Page 9
(BoJ) to raise interest rates to 1.0% in June, the
highest level since 1995. Importantly, at this point
an interest rate hike is actually seen as a positive
for Japanese equities rather than a negative, since
it signals the central bank’s con昀椀dence in the
ongoing strength of the economy. Rising wages
should also feed through to better household
spending, bene昀椀tting some domestically focused
companies. Japan is also home to many leading
players in robotics, electronic components and
machinery that are bene昀椀ciaries of greater spending
by companies on AI. These sectors have also been
highlighted by Japanese Prime Minister Takaichi as
areas of strategic investment going forward. This
is all taking place alongside ongoing progress in
corporate governance reforms in Japan which means
increased company pro昀椀tability is actually 昀椀nding its
way back into the pockets of shareholders. We think
these positive dynamics still have some way to run in
Japan and hence we remain overweight.
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