Japan Economics Update Revisiting the puzzle of falling job vacancies While the official job openings figures have fallen since late-2022, the bulk of the evidence suggests that firms are facing increasingly severe job shortages. One explanation for the fall in job... 12th June 2024 · 4 mins read
Japan Economics Update Why are US import prices from Japan rising? Rising car prices explain why US import prices from Japan haven’t fallen despite the sharp weakening of the yen. While growth in car prices has slowed as supply shortages have unwound, this hasn’t... 10th June 2024 · 2 mins read
Global Economics Update What the latest US tariffs mean for the global economy We held an online Drop-In session today to discuss the Biden administration’s new tariffs on goods from China. This Update answers several of the questions that we received about the direct effects of... 15th May 2024 · 6 mins read
Japan Economics Update Case for FX intervention less compelling than in 2022 The Ministry of Finance may have intervened earlier today by selling FX reserves to halt the sharp fall of the yen. However, the economic case for foreign exchange intervention is much weaker now than... 29th April 2024 · 4 mins read
Japan Economics Update Bank of Japan will hike rates once more in July The Bank of Japan is getting more confident in meeting its inflation target on a sustained basis and signalled that inflation wouldn’t have to overshoot for policy to be tightened further. Nonetheless... 26th April 2024 · 3 mins read
Japan Economics Update Plunge in Tokyo inflation won’t prevent BoJ tightening The plunge in inflation in Tokyo in April was mostly due to a sharp fall in high school tuition fees and the provision of free school meals. The impact of those policy changes on nationwide inflation... 26th April 2024 · 3 mins read
Japan Economics Update Services inflation will remain around 2% this year We now expect services inflation to remain around 2% this year as a fading tailwind from soaring hotel and package tour prices will be offset by stronger labour cost growth. The upshot is that the... 23rd April 2024 · 4 mins read
Japan Economics Update A close race for fourth place The slump in the yen has resulted in Germany overtaking Japan as the world’s 3rd largest economy at market exchange rates. We expect Japan to overtake Germany yet again in the early 2030s as the yen... 9th April 2024 · 4 mins read
Japan Economics Update Banks set to become major holders of JGBs yet again Once the Bank of Japan starts to reduce its huge holdings of Japanese Government Bonds (JGBs) in earnest, we think that commercial banks will once again become major holders of JGBs. Insurance firms... 2nd April 2024 · 2 mins read
FX Markets Update How worried should we be about the renminbi & yen? We continue to think that policymakers in China and Japan will do enough to keep their currencies from weakening much further, but the risk of a break lower in one, or both, is increasing. 27th March 2024 · 5 mins read
FX Markets Update Three key points on the yen’s latest fall In the wake of this week’s FOMC and BoJ policy announcements we are revising our forecast for the Japanese yen. While we still expect the Japanese yen to rebound over the course of 2024, we now... 21st March 2024 · 4 mins read
Japan Economics Update Ultra-loose policy ends but tightening cycle unlikely The Bank of Japan today called time on more than a decade of ultra-loose policy settings, but we don’t think it will lift its policy rate any further over the coming months. 19th March 2024 · 3 mins read
Japan Economics Update Better corporate governance still not paying off The decline in listed firms’ profit margins over the last couple of years despite the tailwind from a weaker yen suggests that improved corporate governance isn’t changing corporate behaviour. While... 4th March 2024 · 2 mins read
Japan Economics Update Trump tariffs a net negative for Japan in the long run We estimate that in the near-term, the drag on Japan’s exports resulting from of a universal 10% US import tariff could be nearly offset by Japan gaining market share at the expense of China in... 26th February 2024 · 4 mins read
Japan Economics Update BoJ has succeeded in creating high-pressure economy The Bank of Japan has succeeded in creating tight labour market conditions through ultra-loose monetary policy and is now reaping the benefits in the form of stronger wage growth. The upshot is that... 22nd February 2024 · 3 mins read
Japan Economics Update Japan isn’t de-industrialising Japan’s industrial production data don’t fully take into account the influence of falling prices and have systematically underestimated the strength of manufacturing output. The upshot is that rather... 19th February 2024 · 2 mins read
