Japan Economics Weekly Overheating in services adds to case for tighter policy The Tankan revealed that capacity shortages in the services sector are now just as pronounced as they were before the pandemic. The survey also suggested that inflationary pressures in non... 15th December 2023 · 7 mins read
Japan Economics Weekly BoJ sending further signals that negative rates will end Data released this week showed that inflation fell sharply in Tokyo while wage growth remains well below the levels the BoJ considers necessary for meeting its 2% inflation target on a sustained basis... 8th December 2023 · 7 mins read
Japan Economics Weekly Sluggish activity need not prevent BoJ from tightening Consumer spending probably isn't quite as weak as the retail sales would suggest and we still expect GDP to rebound this quarter. However, the continued weakness in new job openings suggests that the... 1st December 2023 · 7 mins read
Japan Economics Weekly Kishida on the ropes PM Kishida's disapproval rating has reached levels that prompted his two predecessors to resign. While Kishida could call snap elections by early next year, LDP leadership elections looming for autumn... 24th November 2023 · 7 mins read
Japan Economics Weekly Autos continuing to drive export strength Japan’s auto exports have surged this year, with volumes back at pre-pandemic levels. Its tourism sector has been doing well too as visitor numbers have returned to where they were in 2019. That... 17th November 2023 · 4 mins read
Japan Economics Weekly BoJ preparing the path for further policy changes Governor Ueda has this week been preparing the ground for the next steps in the BoJ’s retreat from ultra-loose policy. Stronger recent wage data and increasing pressure for further, larger pay hikes... 10th November 2023 · 7 mins read
Japan Economics Weekly Tighter fiscal policy will weigh on activity next year Even though the Bank of Japan de facto ended Yield Curve Control this week, the yen slid to a fresh one-year low against the dollar. And while it has gained some lost ground since then as US Treasury... 3rd November 2023 · 5 mins read
Japan Economics Weekly BoJ will probably leave yield cap unchanged for now Media reports suggest that the Bank of Japan may tweak Yield Curve Control yet again at next week’s meeting, but we aren’t convinced the Bank will lift the 10-year yield cap just three months after... 27th October 2023 · 7 mins read
Japan Economics Weekly Profit boost from weak yen helps sustain virtuous cycle As we had anticipated, the weak yen isn’t providing a big boost to Japan’s export volumes. Instead, its impact is mainly felt via higher yen revenue and costs. With firms having passed on the full... 20th October 2023 · 5 mins read
Japan Economics Weekly Above-trend growth won’t be sustained The savings rate bounced back in Q2 as consumption fell and remains above its pre-pandemic average, leaving scope for a renewed rise in spending over the coming quarters. And with inflation set to... 13th October 2023 · 6 mins read
Japan Economics Weekly Virtuous cycle continues as yen weakens The sudden strengthening of the yen after it breached 150 against the dollar earlier this week has triggered speculation that the Ministry of Finance sold foreign exchange reserves to support the yen... 6th October 2023 · 5 mins read
Japan Economics Weekly BoJ Board members starting to call for tighter policy The minutes of the Bank of Japan's July meeting showed a lively debate about the outlook for prices and monetary policy. While many Board members believe that the Bank will have to keep policy loose... 29th September 2023 · 6 mins read
Japan Economics Weekly Government benefitting from higher inflation for now We previously argued that political pressure is one reason to expect the Bank of Japan to tighten policy. However, we suspect the government's stance on inflation has become more ambiguous. While... 22nd September 2023 · 7 mins read
Japan Economics Weekly Bank of Japan will hike policy rate in January Following hawkish comments by BoJ Governor Ueda, we now expect the Bank to lift its policy rate for the first time in sixteen years in January. The Bank could call time on Yield Curve Control at the... 15th September 2023 · 6 mins read
Japan Economics Weekly FX intervention looking increasingly likely With the yen weakening to a one-year low against the dollar, the chances that the authorities will intervene to stem its slide have risen. That would probably have little success if interest rate... 8th September 2023 · 5 mins read
Japan Economics Weekly Economy flatlining in Q3, but recession unlikely Note: We’ll be discussing the China growth/stimulus question, the BOJ’s policy outlook, Indian food price inflation and more in our monthly Asia Drop-In on Thursday, 31 st August. Register here to... 31st August 2023 · 6 mins read
