The violent appreciation of the Japanese Yen was likely a significant driver of last week's market sell-off, but the deleveraging may only be temporary. The Yen is a favorite funding currency for global investors as Japanese interest rates remain around zero even as other countries hiked rates to multi-decade highs. Japanese investors also hold sizable unhedged foreign currency investments to benefit from higher returns abroad. These Yen funded trades lead to compounding gains when foreign […]