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PM Abe on the ropes again

Prime Minister Abe is once again embroiled in a political scandal that raises the possibility that he could be replaced as head of the LDP, and hence as prime minister. This still seems unlikely but, if it did happen, Mr Abe’s departure would not have major implications for the economy.
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Japan Economics Weekly

Respite for BoJ doesn’t weaken case for a policy tweak

Pressure on the Bank of Japan’s Yield Curve Control framework eased this week. On the campaign trail for the Upper House election, where inflation has emerged as a key concern, Prime Minister Kishida said that monetary tightening would do more harm than good. Even more welcome for the BoJ, pressure emanating from the bond market has dropped back too. It had to buy less than a tenth as many JGBs this week as last. Some might feel that this reduces the need to shore up the policy framework. But a respite provides a window in which to make it more resilient.
Asia Drop-In (30th June, 09:00 BST/16:00 SGT): Are Asia’s central banks behind the curve? Can the Bank of Japan and People’s Bank of China continue to go against the grain? Find out in our special session on what global monetary tightening looks like in Asia. Register now.  

24 June 2022

Japan Data Response

Japan Consumer Prices (May 2022)

While inflation didn’t rise any further in May, it will remain above the BoJ’s 2% target until early-2023, while underlying inflation will approach 2%. However, the Bank won’t respond with tighter policy. Asia Drop-In (30th June, 09:00 BST/16:00 SGT): Are Asia’s central banks behind the curve? Can the Bank of Japan and People’s Bank of China continue to go against the grain? Find out in our special session on what global monetary tightening looks like in Asia. Register now.  

24 June 2022

Japan Data Response

Japan Flash PMIs (Jun. 2022)

The PMIs suggest that supply shortages are still holding back manufacturing output and adding to price pressures. On a more upbeat note, the surveys also point to a strong pick-up in consumption as the economy rebounds from the Omicron wave and international tourists return. Asia Drop-In (30th June, 09:00 BST/16:00 SGT): Are Asia’s central banks behind the curve? Can the Bank of Japan and People’s Bank of China continue to go against the grain? Find out in our special session on what global monetary tightening looks like in Asia. Register now.  

23 June 2022

More from Capital Economics Economist

UK Commercial Property Data Response

RICS Construction Market Survey (Q3)

The deterioration in workload expectations is consistent with the fact that, with Brexit uncertainty prolonged and commercial property values expected to fall, a strong increase in the construction activity is unlikely.

7 November 2019

European Data Response

German Industrial Production (May)

May’s industrial data add to the evidence that the weakness in the sector earlier in the year was at least partly down to temporary factors. Overall, the German economy has clearly shifted down a gear this year, but we expect growth to remain fairly strong.

6 July 2018

European Data Response

Euro-zone Retail Sales (May)

May’s euro-zone retail sales data were a little weaker than expected, but still imply that the consumer sector fared better in Q2 than in Q1. And looking ahead, we think that household spending will remain a key driver of economic growth in the region.

3 July 2018
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