Japan Economics Weekly How well is Japan prepared for the digital revolution? Investment in IT equipment and infrastructure has fallen in recent years and there has been no push to raise the low level of university enrolment in related subjects. Still, the country’s ICT... 11th May 2018 · 1 min read
Japan Economics Weekly Slowdown in bank lending no cause for concern The continued slowdown in bank lending seems to vindicate the Bank of Japan’s concerns that low policy rates are undermining financial intermediation. But broader measures of credit availability... 4th May 2018 · 1 min read
Japan Economics Weekly How big a threat are rising hedging costs for banks? An increase in hedging costs has undermined the appeal of investing in US$ bonds for Japanese investors. This won’t affect the profitability of banks much as their holdings of foreign bonds are small... 27th April 2018 · 1 min read
Japan Economics Weekly Policy tightening still a distant prospect The tight labour market is now boosting wage growth but not by enough to generate significant inflation. With the economy likely to slow this year, the Bank of Japan won’t be able to tighten policy... 20th April 2018 · 1 min read
Japan Economics Weekly Will the US bully Japan into a free trade agreement? US President Trump has once again sown confusion by indicating that the US may still join the Trans Pacific Partnership. However, he indicated that this would require a renegotiation of the agreement... 13th April 2018 · 1 min read
Japan Economics Weekly Business investment will continue to impress The early indications point to a fall in capital spending in Q1. However, mounting capacity and staff shortages suggest that spending on machinery and equipment will continue to grow faster than... 6th April 2018 · 1 min read
Japan Economics Weekly Might the labour market be looser than it appears? There is a plausible argument that widespread “underemployment” of employees who would like to work longer hours means that labour market conditions in Japan are not as tight as the historically-low... 29th March 2018 · 1 min read
Japan Economics Weekly Escaping demographic destiny The conventional wisdom is that population ageing results in a falling savings rate and rising interest rates. Yet Japan, despite the high average age of its population, runs a sizeable current... 23rd March 2018 · 1 min read
Japan Economics Weekly Sluggish wage growth to prevent BoJ from tightening We wouldn’t read too much into the early results of this year’s spring wage negotiations, which showed that the large carmakers and electronic firms lifted base pay by less than in 2014 and 2015. But... 16th March 2018 · 1 min read
Japan Economics Weekly Yen strength another stumbling block for BoJ The yen would have to strengthen much further before it turns into a major drag on export competitiveness and corporate profits. However, the recent appreciation should bring the pick-up in goods... 9th March 2018 · 1 min read
Japan Economics Weekly Is this it? Dismal industrial production and weak consumer spending figures for January suggest that Japan’s longest period of uninterrupted expansion since the late 1980s will come to an end this quarter. We... 2nd March 2018 · 1 min read
Japan Economics Weekly Is the BoJ’s 2% inflation target achievable? On past form, capacity shortages alone will never be enough to generate 2% inflation in Japan. The prerequisite for faster price gains is that inflation expectations among households and firms also... 23rd February 2018 · 1 min read
Japan Economics Weekly Why are regional banks’ capital ratios falling? If the Bank of Japan were to reverse course on monetary loosening in the near future, it would more likely be a response to worries about financial stability than high inflation. The recent... 14th February 2018 · 1 min read
Japan Economics Weekly Market turmoil won’t derail expansion The recent sell-off on the stock market would have to continue for much longer before it started to have a major effect on consumer spending in Japan. And with the yen barely changed, the impact on... 9th February 2018 · 1 min read
Japan Economics Weekly Growth still likely to slow this year With our GDP tracker suggesting that activity continued to expand at a rapid clip last quarter, risks to our forecast of a 1.2% rise in GDP this year are skewed to the upside. However, the economy is... 2nd February 2018 · 1 min read
Japan Economics Weekly Would Japan benefit from higher interest rates? Some commentators have been arguing that the Bank of Japan should be raising interest rates now to support household incomes. However, it isn’t clear whether this would boost household spending, while... 26th January 2018 · 1 min read
