Japan Economics Update Exemptions for food won’t dampen blow from sales tax hike The decision to exempt food from the sales tax hike due in 2017 will not make much difference to theblow it causes to economic momentum. It may however make an early election more likely. 16th December 2015 · 1 min read
Japan Economics Update Are wages rising at a record pace? Despite suggestions that wages are now increasing at a record rate, wages have in fact barely increased at all this year. Looking ahead, we suspect that the upcoming spring wage negotiations will... 10th December 2015 · 1 min read
Japan Economics Update Stagnant wage demands another headwind to QQE The fact that Japan’s main trade union federation says that it will not demand stronger pay hikes in the upcoming wage negotiations than it did last time around provides another reason to think that... 26th November 2015 · 1 min read
Japan Economics Update Bank of Japan will still have to ease more While the Bank of Japan does not seem to be overly concerned about the recent weakness in activity, we think price pressures will moderate in coming months as spare capacity has risen. Accordingly, we... 19th November 2015 · 1 min read
Japan Economics Update Monetary Indicators Monitor (Oct.) Bank lending continues to expand at a robust pace, but the increase in domestic credit is dwarfed by the surge in foreign claims, with their yen-value inflated by the weaker exchange rate. 18th November 2015 · 1 min read
Japan Economics Update Cautious Bank of Japan leaves door open for further easing The Bank of Japan pushed back the timing for reaching its 2% inflation target today and sees downside risks to economic activity. With underlying inflation likely to stall soon, we expect policymakers... 30th October 2015 · 1 min read
Japan Economics Update Bank of Japan can’t hide behind low potential growth With potential growth near zero, the occasional quarter of negative GDP growth in Japan is notaltogether surprising or necessarily a disaster. However, the point of the Bank of Japan’s... 22nd October 2015 · 1 min read
Japan Economics Update Is Finance Minister Aso the Bank of Japan’s new oracle? Finance Minister Aso has been downplaying the chances of further monetary stimulus. But given that Japan’s government has previously argued that “surprise” is a key element of effective monetary... 19th October 2015 · 1 min read
Japan Economics Update Monetary Indicators Monitor (Sep.) The doubling of the Bank of Japan’s balance sheet since the launch of QQE has contributed to a strong rise in the money supply and a pick-up in bank lending. With lending rates near record-lows, we... 15th October 2015 · 1 min read
Japan Economics Update Falling import prices create another headwind for the BoJ While the Bank of Japan remains upbeat about the prospects of hitting its 2% inflation target, the fact that non-energy import prices have just recorded the first fall since the launch of QQE... 14th October 2015 · 1 min read
Japan Economics Update Bank of Japan to announce more easing by end of the month While the Bank of Japan today provided few indications that additional stimulus is imminent, weretain our forecast that policymakers will step up the pace of easing by the end of the month. 7th October 2015 · 1 min read
Japan Economics Update Trans-Pacific Partnership deal positive for Abenomics Much of the focus in Japan in the run-up to the successful conclusion of the Trans-Pacific Partnership talks was on agriculture and vehicles. In practice, the economic significance of the agreement in... 5th October 2015 · 1 min read
Japan Economics Update What’s behind the rebound in “core-core” inflation? A closely-watched measure of underlying inflation in Japan has rebounded recently, raising hopes that the Bank of Japan’s easing efforts are finally gaining traction. But most of the rebound in “core... 28th September 2015 · 1 min read
Japan Economics Update New “arrows” don’t change the outlook for Japan’s economy Prime Minister Abe’s announcement of new targets does not alter the outlook for the economy. In the absence of tangible policies to boost productivity and stem the decline in the working-age... 25th September 2015 · 1 min read
Japan Economics Update Are the wages data misleading us? Some BoJ Board Members have cast doubt on the accuracy of the monthly wage data, which show tepid income growth. By contrast, we think these figures reflect the circumstances of Japan’s workers fairly... 22nd September 2015 · 1 min read
Japan Economics Update Monetary Indicators Monitor (Aug.) Low interest rates and debt-to-income ratios suggest that Japan’s households and firms can continue to borrow as strongly as they have in recent months. 17th September 2015 · 1 min read
