Japan Economics Focus Election unlikely to revive Abenomics Victory for Prime Minister Abe in this month’s election would keep Japan on the same track it has been on since 2012, pursuing fiscal tightening, loose monetary policy and tentative structural reform... 10th October 2017 · 1 min read
Japan Economics Focus Will wage growth strengthen again? We expect the expansion in the labour force to slow in coming years which suggests that wage growth should soon start picking up again. However, the shift to flexible employment forms, globalisation... 6th June 2017 · 1 min read
Japan Economics Focus Is the Bank of Japan’s work done? Japan’s economy has been performing well recently and we expect growth to exceed most estimates of its sustainable rate this year. But inflation remains low and, with wages still barely rising, there... 15th May 2017 · 1 min read
Japan Economics Focus Will Japan benefit from higher inflation? Deflation has not done as much damage to Japan’s economy as is often thought and, correspondingly, a return to inflation is unlikely to deliver major benefits for now. However, we remain convinced... 10th April 2017 · 1 min read
Japan Economics Focus Will the Bank of Japan have to start tightening soon? Japan’s economy has performed well recently and inflation is set to rise sharply soon. But the spike in inflation won’t last and, with inflation expectations no higher now than when the Bank of Japan... 7th March 2017 · 1 min read
Japan Economics Focus Has the Bank of Japan finished easing? With the recent improvement in the inflation outlook, the Bank of Japan is unlikely to ease further in 2017 but any speculation about policy tightening will prove premature. In fact, the Bank’s pledge... 23rd January 2017 · 1 min read
Japan Economics Focus Will business investment remain sluggish? Investment by Japanese firms has been disappointingly weak recently. Capacity utilisation is high and firms are in a strong financial position to step up spending, but we nonetheless expect the recent... 19th October 2016 · 1 min read
Japan Economics Focus Are negative interest rates working? Negative interest rates have succeeded in lowering bond yields and bank lending rates in Japan without undermining lenders’ willingness to provide credit. However, credit growth has nonetheless... 8th September 2016 · 1 min read
Japan Economics Focus Has Abenomics failed? Structural reforms since the launch of Abenomics have been insufficient to improve the medium-term outlook for Japan’s economy. Meanwhile, monetary policy is running into diminishing returns. As a... 27th June 2016 · 1 min read
Japan Economics Focus Is the grass greener in Tokyo? We expect Tokyo’s economy to outperform the rest of Japan in coming years, largely because demographic prospects in the capital are brighter. One consequence is that house prices in Tokyo should... 7th April 2016 · 1 min read
Japan Economics Focus Is another bubble inflating in Japan’s housing market? There has been some recent talk of froth returning to Japan’s housing market but prices, other than for condominiums, are not rising at a rapid rate. With debt levels also stable, there are no signs... 25th February 2016 · 1 min read
Japan Economics Focus Will underlying inflation continue to rise? We believe that the recent strength in the Bank of Japan’s new core inflation measure reflects the lagged pass-through to prices of the weaker yen rather than a pick-up in domestic price pressures... 23rd November 2015 · 1 min read
Japan Economics Focus When will the BoJ have to start tapering its JGB purchases? We estimate that QQE can continue for at least another five years even if the Bank of Japan steps up the annual pace of expansion of the monetary base to ¥90 trillion in October. As such, the fate of... 21st September 2015 · 1 min read
Japan Economics Focus Will population ageing help or derail efforts to boost inflation? Other things being equal, population ageing should boost price pressures. But that hasn’t happened in Japan because there has been an offsetting increase in the share of adults willing to work... 30th July 2015 · 1 min read
Japan Economics Focus Will Japan’s budget deficit continue to shrink? Even if the government goes ahead with the sales tax that is currently scheduled for 2017, we think it will struggle to reduce the budget deficit much further. Rather than more fiscal reforms, the... 18th June 2015 · 1 min read
Japan Economics Focus What could policymakers do next if QQE doesn’t work? The Bank of Japan’s 2% inflation target remains out of sight despite the benefits of a much weaker exchange rate. With the potential to expand QQE in its current form limited, new approaches are... 16th April 2015 · 1 min read
