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Japan’s rich will invest US$1.4 trillion more by 2030, report says

A lounge inside the Hills House facility at the Azabudai Hills complex in Tokyo. (Photo: Toru Hanai/Bloomberg)
A lounge inside the Hills House facility at the Azabudai Hills complex in Tokyo. (Photo: Toru Hanai/Bloomberg) (Bloomberg)

By Taiga Uranaka

(Bloomberg) — Mega-wealthy Japanese will contribute to a more than 30% surge in the value of assets they invest by the end of the decade as cash-heavy households deploy more in markets, according to an analysis by Morgan Stanley.

The investments by the combined segment of ultra-high net worth individuals and the “upper affluent” will reach 906 trillion yen (US$5.8 trillion) by 2030, up from the current level of around 690 trillion yen, the report on the country’s wealth transition showed.

That backdrop provides a sales opportunity for the nation’s financial firms worth around $38 billion, according to the report. Banks and brokerages in Japan are turning to wealth management as a key pillar of growth for the future just as a rally in the stock market and the end of the Bank of Japan’s negative interest rates policy signal a revitalised interest in the nation’s assets.

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Young affluent Japanese were singled out as a particular source of potential growth.

“As this group increases its wealth and its portfolio needs get more sophisticated, we think that mutual fund inflows could be significant in the longer term,” the group of strategists and analysts wrote in the May 16 report.

©2024 Bloomberg L.P.