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2026

2025

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  • Daiwa's Economic View - Apr-Jun GDP: Economy still resilient despite lingering uncertainties

    Daiwa's Economic View - Apr-Jun GDP: Economy still resilient despite lingering uncertainties

    15 August 2025 516 KB PDF
    • Japan's economy showed no impact from Trump's tariffs in Apr-Jun 2025, but be aware some may emerge from Jul-Sep 2025
    • We forecast real GDP growth of +0.0% q/q (+0.2% annualized) for Jul-Sep 2025
  • Daiwa's Economic View - Cabinet’s budget formulation authority threatened by opposition parties’ bill to cut gasoline tax

    Daiwa's Economic View - Cabinet’s budget formulation authority threatened by opposition parties’ bill to cut gasoline tax

    15 August 2025 387 KB PDF
    • Opposition parties’ bill to cut gasoline tax is likely to pass as ruling parties lack a majority in both upper and lower houses
    • If passed, the tax cuts would preempt the budget formulation authority inherently held by cabinet, undermining the foundation of parliamentary cabinet system
    • This would result in fiscal expansion without clear accountability, adding a new risk factor to the JGB market
  • Daiwa's Economic View - BOJ July MPM Summary of Opinions: Step closer to rate hike within 2025

    Daiwa's Economic View - BOJ July MPM Summary of Opinions: Step closer to rate hike within 2025

    8 August 2025 533 KB PDF
    • BOJ's July Summary of Opinions strikes hawkish tone
    • Many opinions on economic activity and prices optimistic, cite upside risks
    • More opinions on monetary policy conduct advocate early rate hikes
    • Hawkish Summary of Opinions vs. dovish Governor's press conference
  • Daiwa's View - Discussions within BOJ on tariffs, trade policy: At stage for mulling resumption of rate hike

    Daiwa's View - Discussions within BOJ on tariffs, trade policy: At stage for mulling resumption of rate hike

    6 August 2025 394 KB PDF
    • Economic slowdown pressure due to tariffs may not be as strong as feared at April's meeting
    • Many firms plan to continue raising wages despite US tariff policies
    • Expect to realize outlook in which trade issues progress “without escalation”
  • Daiwa's Economic View - Economy vs. inflation dilemma: Conditions for 2% trend inflation

    Daiwa's Economic View - Economy vs. inflation dilemma: Conditions for 2% trend inflation

    6 August 2025 1144 KB PDF
    • Conditions for 2% underlying inflation: Focus on general services, utility fees, rents, food
    • Need to assess economic trends, but inflation overshoot a concern BOJ's scenario of flat underlying inflation may not materialize
    • Market should be wary of the fact that BOJ price forecasts have been revised upwards systematically
  • Daiwa's View - What are the potential obstacles to BOJ raising rates in 2025?

    Daiwa's View - What are the potential obstacles to BOJ raising rates in 2025?

    5 August 2025 450 KB PDF
    • BOJ views autumn as the earliest timing for rate hike
    • A rate hike would require that mechanism in which wages and prices influence each other positively continues uninterrupted
    • Potential obstacles to BOJ raising rates within the year: (1) greater-than-expected deterioration in corporate business conditions from this autumn onwards, (2) extreme political instability, and (3) aggressive rate cuts by Fed due to concerns about softening of US labor market
  • Daiwa's View - BOJ likely to hike rates within this year

    Daiwa's View - BOJ likely to hike rates within this year

    1 August 2025 883 KB PDF
    • Yen pushed up to USD/JPY150 level as BOJ decision to maintain status quo disappoints markets
    • This yen depreciation now biggest force for moving forward timing of interest rate hike within this year
    • BOJ Governor Ueda’s press conference left dovish impression, but our forecast for rate hike in Oct-Dec remains unchanged
  • Daiwa's Economic View - How agreement to invest $550bn in US will impact JGB issuance

    Daiwa's Economic View - How agreement to invest $550bn in US will impact JGB issuance

    31 July 2025 407 KB PDF
    • Agreement to invest $550bn in US: Japanese government allocating same amount of financial support to JBIC and NEXI to encourage Japanese companies to invest in US
    • $550bn (approx. Y80tn) over 3.5 years is extremely high hurdle considering past results, cautious management stance of Japanese firms
    • Impact on JGB issuance: Initially be limited to Y1-2.0tn in construction bonds to strengthen financial bases for JBIC and NEXI; afterwards, if investment increases, issuance of FILP bonds will increase