Japan’s economy probably recorded the fifth straight quarter of growth in Q1, the longest streak since 2005. The unemployment rate is at multi-year lows and corporate profit margins at record highs. However, there is still little sign that capacity shortages are fuelling price pressures. Accordingly, we still expect the Bank of Japan to leave policy settings unchanged for a prolonged period which should help to keep the yen weak. In turn, this should provide a fillip for the Nikkei, but we think that further upside is capped by elevated valuations.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services