Bank of Japan Monetary Policy Unchanged as Expected Raises Inflation Forecast

The Bank of Japan as widely expected kept unchanged its -0.1% target for short-term interest rates, and 0% for the 10-year government bond yield by a 8-1 vote. The BOJ raised its inflation forecast on Thursday but kept guidance on policy bias and says to take more easing steps without hesitation as needed with eye on pandemic’s impact on economy. The bank will remain an outlier among a global wave of central banks tightening monetary policy.  BoJ Chief Kuroda BOJ … Continue reading “Bank of Japan Monetary Policy Unchanged as Expected Raises Inflation Forecast”

Japanese Industrial Production Plummets to -7.2% m/m in May

Japan’s preliminary industrial production for May 2022 came in at -7.2% m/m much lower than the expected -0.3% m/m and the April reading of -1.5%. Two years ago, deep in the pandemic industrial production was -4.2% m/m. Production in the auto sector continues to suffer from a global parts supply crunch as output of cars and other motor vehicles suffer. Earlier today Toyota reported they missed its production targets for May with overall production levels through the first five months … Continue reading “Japanese Industrial Production Plummets to -7.2% m/m in May”

Japanese Consumers Spending at Steepest Pace Since May 2021

Japan’s retail sales rose for the third straight month in May 2022 and at the steepest pace since May 2021. The lift came from the strength in consumption as the government has lifted all COVID-19 restrictions. Japanese sales of general merchandise picked up sharply at 20.7% vs 8% in April with faster rises in sales of fabric apparel & accessories at 11.8% vs 9.7%. Meanwhile, sales of motor vehicles dropped for the ninth consecutive months -10.1% vs -7.5%.  Auto sales … Continue reading “Japanese Consumers Spending at Steepest Pace Since May 2021”

Kuroda at G7 Said Bank of Japan Will Continue with Powerful Easing with CPI Unsustainable

The Bank of Japan chief Kuroda speaking at the G7 said BOJ will patiently continue with powerful easing announcing no change to monetary policy. While the major central banks tighten other than the PBOC Japan has taken a different path. Earlier today Japanese CPI came in with 2.5% headline and 2.1% core prices.  BoJ Chief Kuroda Kuroda did acknowledge the latest CPI but also said that he’s forecast 2% inflation for a while and that it’s not sustainable in Japan … Continue reading “Kuroda at G7 Said Bank of Japan Will Continue with Powerful Easing with CPI Unsustainable”

Japan Adds to Bond Route Selling Treasuries as Currency Hedging Costs Soar

Bonds have collapsed at a rapid pace with soaring inflation and a one-way market. The US dollar has soared at the same time with the BOJ and the Fed Reserve at difference policy ends. The Japanese Central Bank still is an aggressive buyer of JGB’s while the Fed pares its $9 trillion balance sheet. Japanese institutional managers are now selling US bonds, BMO Capital Markets shows they have offloaded almost $60 billion over the past three months. One could argue this … Continue reading “Japan Adds to Bond Route Selling Treasuries as Currency Hedging Costs Soar”

Japanese Industrial Production Surges to Record High 7.2% m/m In November

Japan’s preliminary industrial production for November came in at 7.2% m/m much higher than the expected 4.8% m/m and the October reading of 1.8%. Two years ago, deep in the pandemic industrial production was -4.2% m/m. Production in the auto sector benefited from a global parts supply recovery, output of cars and other motor vehicles surged 43.1% for the month Japan Industrial Production for November 2021 (preliminary)  Industries that mainly contributed to the increased 1.Motor vehicles, 2.Plastic products, 3.Iron, steel … Continue reading “Japanese Industrial Production Surges to Record High 7.2% m/m In November”

Soft Consumer Spending Sees Japan’s Q3 GDP Downgraded Further

Japan’s economy shrank 0.9% in the third quarter from the previous quarter, at an annualized pace of 3.0%, the Cabinet Office announced on Monday. This was worse than the previous estimate as the Coronavirus and supply shortage had more of a dampening affect than first thought. Japan Q3 GDP (2nd reading) GDP -0.9% q/q vs -0.8% expected GDP y/y -3.6% vs -3.1% expected (first estimate -3.0%) Private consumption -1.3% vs -1.1% prelim External demand 0.0% vs +0.1% prelim Inflation deflator … Continue reading “Soft Consumer Spending Sees Japan’s Q3 GDP Downgraded Further”

Japanese Yen and Swiss Franc Attract Flight To Safety Bids on Virus Fears

The Japanese yen and the Swiss franc received safe haven bids on Friday as the global markets panicked on news of the Covid Omicron variant. In a thin market it also gave traders an opportunity to book profits after an extended rally in the US dollar. On the flip side commodity beneficiaries and the growth sensitive Australian dollar and Norwegian krone sold off. Moves weren’t just against the dollar. Whilst the euro rose 0.97 percent to a high of US$1.1312, … Continue reading “Japanese Yen and Swiss Franc Attract Flight To Safety Bids on Virus Fears”

Bank of Japan Monetary Policy Unchanged, Revised CPI and GDP Forecasts Lower As Expected

The Bank of Japan announced no change to monetary policy as widely expected. The BOJ short-term interest target kept at -0.1% and the 10 year JGB yield target remains around 0%. BoJ revised its CPI and GDP forecasts lower.