Japan Economics Weekly Roaring start to year unlikely to last Japan’s economy probably expanded for the fifth straight quarter as consumer spending is finally recovering in earnest. The activity surveys suggest that growth held up in the second quarter and we’ve... 21st April 2017 · 1 min read
Japan Economics Weekly Bank of Japan remains too optimistic about inflation While there are good reasons to believe that inflation will continue to recover in coming months, the Bank of Japan’s most recent forecasts from January are far too optimistic. Downward revisions to... 13th April 2017 · 1 min read
Japan Economics Weekly Monetary policy to remain loose for longer While the economy should continue to grow at a robust pace, price pressures will strengthen only slowly. And with the sales tax hike scheduled for end-2019 clouding the outlook, the Bank of Japan is... 7th April 2017 · 1 min read
Japan Economics Weekly Durable goods consumption set to rebound A range of policy decisions that encouraged consumers to bring forward purchases of durable goods contributed to keeping consumer spending weak in recent years. But with the replacement cycle now... 31st March 2017 · 1 min read
Japan Economics Weekly House price surge unlikely to boost construction Residential property prices in Japan have risen unusually fast since the launch of Quantitative and Qualitative Easing, led by an investment-driven surge in condominium prices. But there are signs... 24th March 2017 · 1 min read
Japan Economics Weekly Much faster wage growth still needed We wouldn’t read much into the smaller pay hikes for employees of large manufacturing firms that have been agreed in this year’s Shunto wage negotiations. Wage growth for most workers looks set to... 17th March 2017 · 1 min read
Japan Economics Weekly Will four more years of Abenomics make a difference? Prime Minister Abe is set to become Japan’s longest serving Prime Minister and could plausibly now serve until 2021. While his government had some early successes in removing roadblocks to stronger... 10th March 2017 · 1 min read
Japan Economics Weekly Low labour mobility limiting wage gains The national accounts data show that wage growth has slowed in recent quarters even as the labour market has continued to tighten. With the lifetime employment model preventing employees from... 3rd March 2017 · 1 min read
Japan Economics Weekly What next for Japan’s free trade agreements? With the writing on the wall for the TPP, Japan’s government believes that its next best bet would be a bilateral deal with the US. In principle, this could generate sizeable benefits by opening Japan... 24th February 2017 · 1 min read
Japan Economics Weekly Immigration easing labour shortages Immigration to Japan is starting to make a meaningful difference in its labour market: the number of foreign workers rose by nearly 20% last year. With Japanese people more accepting of immigration... 17th February 2017 · 1 min read
Japan Economics Weekly Deflationary threat far from over The Bank of Japan’s preferred measure of underlying inflation fell to a fresh low in December. While the weaker exchange rate and the recovery in commodity prices should result in a rebound in coming... 10th February 2017 · 1 min read
Japan Economics Weekly Tight labour market finally boosting incomes There is growing evidence that the tightness of Japan’s labour market is finally feeding into faster growth in incomes. This should support stronger private consumption at least until inflation... 3rd February 2017 · 1 min read
Japan Economics Weekly Will Trump wreak havoc on Japan’s exporters? President Trump has threatened to impose a tariff on Mexican and Chinese imports, which wouldn’t create insurmountable challenges for Japanese firms producing cars and other products in these... 27th January 2017 · 1 min read
Japan Economics Weekly Budget improvements set to stall Official data show a sharp decline in the budget deficit but it remains sizeable and we don’t expect the narrowing to continue. In any case, the key determinant of the sustainability of the public... 20th January 2017 · 1 min read
Japan Economics Weekly How much spare capacity is left? Recent revisions to the GDP data suggest that the output gap has all but closed. However, the main factor holding back inflation over the last two decades were entrenched deflation expectations rather... 13th January 2017 · 1 min read
Japan Economics Weekly Who will benefit from rising US interest rates? The recent slump in the yen has lifted the yen-value of foreign assets and associated income streams. We estimate that the government’s net debt has fallen by 11% of GDP since the US election as the... 6th January 2017 · 1 min read
