FX Markets Update Weakness in the yen looks overdone to us The rise in US bond yields has put renewed pressure on the yen, but we think further downside is limited. We still expect Treasury yields to resume their downward trend and for the yen to benefit most... 15th February 2024 · 4 mins read
Japan Economics Update Policy normalisation is in sight The Bank of Japan sounds increasingly confident that it will be able to achieve its inflation target on a sustained basis. With Mr Ueda at the post-BOJ-meeting press conference again emphasising the... 23rd January 2024 · 3 mins read
Japan Economics Update Looming manufacturing downturn another headwind Industrial output has usually fallen rather sharply whenever firms were as pessimistic about the production outlook as they are now. That’s consistent with our view that GDP growth next year will be... 28th December 2023 · 3 mins read
Japan Economics Update Negative interest rates will end in early-2024 The Bank of Japan left policy settings unchanged today as widely anticipated. And while Governor Ueda is sounding more confident that 2% inflation will be sustained, we now expect the Bank of Japan to... 19th December 2023 · 3 mins read
Japan Economics Update Negative interest rates will end in early-2024 We are resending this publication because it was incorrectly sent as a Japan Rapid Response. The Bank of Japan left policy settings unchanged today as widely anticipated. And while Governor Ueda is... 19th December 2023 · 3 mins read
Global Economics Update Key risks for 2024 In this Global Economics Update, we describe eight of the biggest risks to our economic forecasts for 2024. The unusual nature of this cycle and uncertainties surrounding the transmission of monetary... 30th November 2023 · 6 mins read
Global Markets Update BoJ normalisation points to higher JGB yields & stronger yen We think the Bank of Japan’s continued steps towards policy normalisation are consistent with somewhat higher JGB yields and a significant rebound in the yen over the coming quarters. In view of the... 2nd November 2023 · 4 mins read
Japan Economics Update Bank will end negative interest rates in early-2024 The Bank of Japan today de facto abolished Yield Curve Control and we think policymakers will call time on negative interest rates as soon as January. 31st October 2023 · 4 mins read
Japan Economics Update Shunto will result in base pay hike well above 2% Japan’s trade unions are demanding an even larger pay hike in the upcoming spring wage negotiations and we believe that the talks will result in a base pay hike of around 2.5%. While the Bank of Japan... 20th October 2023 · 4 mins read
Japan Economics Update Labour market should tighten again before long The job-to-applicant ratio has usually signalled earlier than the Tankan that the labour market has taken a turn for the worse. But despite the recent fall in the number of jobs relative to applicants... 16th October 2023 · 2 mins read
Japan Economics Update What do higher rates mean for the BoJ’s finances? Any fall in bond prices resulting from higher bond yields won’t affect the BoJ’s balance sheet unless the Bank decides to sell its holdings. By contrast, rising interest payments on commercial banks’... 10th October 2023 · 3 mins read
Japan Economics Update How a surge in bond yields could yet wreak havoc We expect any rise in bond yields to be gradual and don’t believe it will create major economic or market dislocation. But there are risks that the Bank of Japan loses control over longer-term yields... 5th October 2023 · 6 mins read
Global Economics Update The bond market sell-off and the global economy The sell-off in bond markets has taken a breather today, helped in part by softer data on the US labour market. However, the scale of the moves over the past week has invoked comparisons to previous... 4th October 2023 · 6 mins read
Japan Economics Update The impact of tighter policy on financial stability By putting upward pressure on JGB yields and the yen, tighter monetary policy could lead to falls in the value of bonds and overseas assets held by Japanese investors. Insurance companies and pension... 3rd October 2023 · 4 mins read
Japan Economics Update End of Yield Curve Control won’t spell fiscal disaster The abandonment of Yield Curve Control would probably prompt the Bank of Japan to reduce its bloated holdings of government bonds, which could push up long-term bond yields. However, there are good... 25th September 2023 · 4 mins read
