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Daiwa's Economic View - Outlook for Japan's economy, policy rate
1 October 2024
579 KB
PDF
Expect only modest growth for Japan’s economy in FY24 as consumption recovery is delayed
Forecast core CPI to remain above 2.0%Y/Y toward FY25; price outlook risks balanced to upside and downside
BoJ’s decision to hike rates heavily dependent on assessment of US economy; expect next hike in Jan-Mar 2025, assuming soft landing for US economy
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Public Finance Watch
30 September 2024
377 KB
PDF
Following election of new PM Ishiba, press speculating Lower House to be dissolved on 14 Oct for snap election on 27 Oct
Schedule almost same as that after PM Kishida was elected three years ago; if instructions to formulate economic stimulus package issued before dissolving Lower House, Cabinet could approve supplementary budget proposal for FY24 in late Nov
Cabinet to determine initial FY25 budget proposal after 20 Dec, as usual
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Economic Commentary - BoJ Goveror's speech, future focus points
25 September 2024
498 KB
PDF
Governor Kazuo Ueda reiterated that BoJ will not hurry to raise rates as it seeks to carefully assess state of US economy
Runoff between Ishiba/Takaichi likely to follow 27 Sep LDP leadership vote; Ishiba seems to have a slight advantage
Focus in BoJ Tankan (1 Oct) on corporate earnings/behavior based on changes in backdrop since Aug
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Politics Watch - LDP presidential election: Pro-Abenomics, anti-Abenomics showdown?
24 September 2024
429 KB
PDF
Focus now on runoff outcome; still unclear, but Ishiba/Takaichi showdown possible
Outcome unclear even if runoff between Ishiba/Takaichi; still, Ishiba has slight advantage as “face” for general election.
Ishiba/Takaichi runoff would be closely watched as battle over Abenomics; policies may not differ as much as images suggests
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Daiwa's Economic View - BoJ in no rush, assessing US economy
24 September 2024
500 KB
PDF
BoJ Governor Ueda’s Sep press conference: Enough time to make policy decisions Japan’s economy now on track, but uncertainty for US economy Ueda more concerned about US economy than Fed Chairman Powell
Impacts of minimum wage hike as new point of interest for Japan’s economy
Authors’ main scenario calls for additional rate hike in Jan-Mar 2025 (policy outlook table provided) Hike as early as Jan possible, assuming soft landing for US economy
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Daiwa's Economic View - Vector differences, but also similarities for US/Japan monetary policy
20 September 2024
591 KB
PDF
Japan/US monetary policy diverge, forex trends change Fed begins rate cuts, judgement difficult around inflection points BOJ/Fed both in no hurry, both adjusting from extremes
BoJ’s rate hike is foregone conclusion, mental exercise suggests 25bp hike once every six months Past experience suggests overseas factors could prevent hike; depends on US economy this time
BoJ to put rate hike on hold this autumn; Oct warrants attention
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Daiwa's View - USD/JPY outlook after Fed starts cutting rates
20 September 2024
404 KB
PDF
Risk of rising US rates if Fed’s outlook is on track
Assume exchange rate in upper USD/JPY140 range if likelihood of soft landing increases
Sharp yen appreciation if Fed cuts rates in earnest due to hard landing
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Daiwa's View - Preview of Sep BoJ MPM
18 September 2024
678 KB
PDF
BoJ to put rate hikes on hold this autumn
Officials are not ruling out Dec or Jan 2025 rate hike at this point
For now, we should monitor trends with market and other central banks, including the Fed
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