Japan Economics Weekly Has QQE really lifted inflation expectations? In contrast to the Bank of Japan, we are far from convinced that QQE has lifted inflation expectations. In fact, wage and price setting behaviour have changed little since the programme was launched... 24th April 2015 · 1 min read
Japan Economics Weekly Will the use of JGBs as collateral hamper QQE? Around 20% of all Japanese Government Bonds (JGBs) are currently used as collateral with the Bank of Japan or in private repurchase agreements. However, there are various ways to ensure that a... 17th April 2015 · 1 min read
Japan Economics Weekly Re-shoring not as beneficial as widely thought Despite press reports that suggest the opposite, there is no evidence that Japanese firms have returned manufacturing production to their homeland on a large scale. Even if they did, this would be no... 10th April 2015 · 1 min read
Japan Economics Weekly Did Chinese New Year distort Japan’s activity data? The unusually late timing of Chinese New Year may have distorted Japan’s recent activity data by causing a surge in output and exports in January followed by a slump in February. However, firms... 3rd April 2015 · 1 min read
Japan Economics Weekly Why are firms borrowing more? Despite exceptionally strong corporate profits and falling investment, corporate debt increased by the most since 2008 last quarter. With interest costs at record lows, firms seem to be borrowing to... 27th March 2015 · 1 min read
Japan Economics Weekly Shunto pay hikes still too small to lift inflation to 2% The early results from this year’s spring wage negotiations confirm that the tight labour market has boosted wage pressure. However, this year’s overall increase in labour income will likely still... 20th March 2015 · 1 min read
Japan Economics Weekly Overtime hours point to lingering job market slack Judging by the unemployment rate alone, the labour market is tight, vindicating the Bank of Japan’s view that price pressure has strengthened since the launch of QQE. But other measures, such as the... 13th March 2015 · 1 min read
Japan Economics Weekly Export strength unlikely to last There are some reasons to believe that the recent strength in export volumes is the result of improvements in competitiveness linked to currency weakness. However, the trade data tend to be volatile... 6th March 2015 · 1 min read
Japan Economics Weekly Electricity prices to remain high The recent plunge in the price of energy has reduced the cost advantage of nuclear relative to thermal electricity generation, and rendered a rapid restart of Japan’s nuclear reactors increasingly... 27th February 2015 · 1 min read
Japan Economics Weekly Stabilising public debt remains a daunting task The Bank of Japan continues to express confidence in its ability to meet its 2% inflation target. But even that would probably not be enough to reduce the public debt burden. In a best-case scenario... 18th February 2015 · 1 min read
Japan Economics Weekly Can educated women save Japan? Efforts to bring more women into Japan’s labour market have enjoyed success in recent years.However, it remains the case that relatively few educated women are in paid work. We estimatethat lifting... 6th February 2015 · 1 min read
Japan Economics Weekly BoJ pinning hopes on strong Shunto wage deal A strong rise in base pay in the spring wage negotiations (Shunto) would help convince the Bank of Japan that the current weakness in inflation will prove temporary. A tight labour market and strong... 30th January 2015 · 1 min read
Japan Economics Weekly Limited demand boost from cheaper oil The plunge in crude oil prices since last summer will reduce the cost of Japan’s energy imports by around 2.5% of GDP in the near term. However, much of the windfall will be saved and the boost to... 23rd January 2015 · 1 min read
Japan Economics Weekly Fading fiscal headwind to bolster demand Despite surging tax revenues, we doubt that the government will reach its target of halving the primary deficit in the coming fiscal year. However, fading fiscal drag should at least ensure that the... 16th January 2015 · 1 min read
Japan Economics Weekly How much lower will unemployment get? The unemployment rate has fallen below the level consistent with stable price pressure in recent months. It is unlikely to fall much further, as the pool of attractive job candidates is drying up... 9th January 2015 · 1 min read
