Japan Economics Weekly Less short-term pressure on Yield Curve Control The case for abandoning Yield Curve Control (YCC) has weakened further. The recent troubles at US regional banks and Credit Suisse should further reduce already easing pressure on the 10-year JGB... 17th March 2023 · 5 mins read
Japan Economics Weekly Yield Curve Control set to end in April The Bank of Japan didn’t alter policy settings at today’s meeting. With economic activity set to disappoint the Bank’s overly optimistic forecasts and wage growth slowing again, the case for... 10th March 2023 · 6 mins read
Japan Economics Weekly Economy headed for recession We're expecting industrial production to rebound strongly in February. Even so, industrial output will still slump this quarter, pointing to a larger q/q fall in Q1 GDP than we’re forecasting. However... 3rd March 2023 · 5 mins read
Japan Economics Weekly Market pressure on Yield Curve Control intensifying Deputy Governor Amamiya’s reason for rejecting the governorship has made clear that the government wants to pivot away from the ultra-easy monetary policy of the past decade. As a result, market bets... 24th February 2023 · 7 mins read
Japan Economics Weekly Consensus is too optimistic about GDP growth The economy expanded at a slower pace in Q4 than most anticipated, and while the second consecutive fall in export volumes in January largely reflects distortions from the Lunar New Year, it’s... 17th February 2023 · 5 mins read
Japan Economics Weekly Ueda the Unknown Kazuo Ueda was present as a member of the Bank of Japan’s Policy Board at the birth of both the Zero Interest Rate Policy in 1999 and Quantitative Easing in 2001 and took the dovish side of arguments... 10th February 2023 · 8 mins read
Japan Economics Weekly Electricity rate hike to dilute government subsidies Seven of Japan's ten regional utility companies have applied to the government to raise electricity prices for households. If approved, headline inflation would still drop below the Bank of Japan’s 2%... 3rd February 2023 · 5 mins read
Japan Economics Weekly Funding tussle may scupper higher spending on babies PM Kishida’s plan to lift spending on childcare would take the total outlay to the highest in the OECD. However, this likely won’t have much of an impact on the stubborn decline in fertility. After... 27th January 2023 · 7 mins read
Japan Economics Weekly 10-year yield ceiling will be tested again soon 10-year JGB yields have traded well within the 50bp tolerance band since the BoJ maintained its policy settings on Wednesday. Even so, we still expect the Bank to jettison Yield Curve Control in April... 20th January 2023 · 4 mins read
Japan Economics Weekly Price pressures broadening, 10-year yields at 0.5% There are early signs that the surge in “core” goods inflation is running out of steam, but services inflation is strengthening. Services inflation won’t accelerate fast enough to offset the coming... 13th January 2023 · 8 mins read
Japan Economics Weekly Manufacturing slumping, but tourism set to rebound Industrial production probably recorded the largest fall since the slump at the start of the pandemic last quarter. Q4 GDP will nonetheless rebound, helped by a strong recovery in services activity... 6th January 2023 · 4 mins read
Japan Economics Weekly New 10-year ceiling will be tested before long The widening of the tolerance band around the BoJ’s target for 10-year yields announced on Tuesday aims to improve bond market functioning. But if this week is any guide, that purpose remains out of... 23rd December 2022 · 9 mins read
Japan Economics Weekly Inventory build-up points to looming recession Surges in manufacturing inventories in the BoJ’s Tankan have a strong record in providing early warnings of economic downturns. The strong rise in inventories over the last couple of quarters... 16th December 2022 · 5 mins read
Japan Economics Weekly Consumers will struggle next year The strong rise in services spending in October suggests that consumers are finally learning to live with the virus so a rebound in Q4 GDP looks very likely. But with real incomes slumping, that... 9th December 2022 · 7 mins read
Japan Economics Weekly Japanese carmakers struggling in decarbonising world The conventional wisdom is that the continued difficulties of Japan’s car industry reflect persistent supply shortages. But there are structural headwinds too as the industry has missed the EV... 2nd December 2022 · 6 mins read
Japan Economics Weekly Discretionary spending cuts hurting service sector While the rebound in inbound tourism is positive for the accommodation and transport sectors, the wider services sector is struggling because households are having to cut back on discretionary... 25th November 2022 · 7 mins read
