Templeton Global Investments’ 2026 outlook argues that Japan’s escape from deflation and accelerating corporate reform are laying the foundation for sustained equity outperformance
The return of sustainable inflation and pro-growth Takaichi policies are normalising nominal GDP growth, supporting multiyear EPS expansion.
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Broadening corporate reforms—focused on ROE improvement, capital discipline and portfolio restructuring—are driving structural profitability gains.
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Persistent valuation discounts to global peers leave room for P/E rerating as global investors remain underweight Japan.
Is this a cyclical rebound—or a generational reset for corporate Japan? The full outlook assesses the durability of the transformation.
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