The rapid recovery in car exports in November probably has further to run and continued strength into next year poses upside risks to our forecast for a cumulative 3.3% rise in Japanese exports across Q4 and Q1 2022. However, the global spread of Omicron remains a downside risk to the recovery. If Omicron does take hold soon and proves to be more severe than early reports suggest, we doubt Japan's booster rollout will have made enough progress to change the maths much on government containment measures. Elsewhere, on the back of our more hawkish Fed view, we are now forecasting a weakening in the yen to 122 against the dollar by end-2023.
– This will be the last Economics Weekly for 2021. The next Weekly will be sent on Friday 7th Jan. 2022 –
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