Japan Economic Outlook
October 27, 2020Available data points to an improving but still-subdued panorama in the third quarter, following the sharp contraction sustained by the economy in the second quarter. The unemployment rate hit an over three-year high in August, while consumer confidence remained mired in pessimism, despite improving to its best level since February, likely keeping a lid on the rebound in private consumption in the third quarter. Moreover, the much-studied Tankan business confidence survey for Q3 remained deeply negative, boding ill for capital spending in the period. Turning to Q4, the economy began the period on a muted footing, with the composite PMI remaining deep in contractionary territory in October. Moreover, the recent resurgence in cases abroad could weigh on the external sector in the months ahead.
Japan Economic GrowthGDP is forecast to rebound in 2021 from the sharp downturn this year. Sustained government spending should bolster the recovery in domestic demand, while improving external demand should drive higher exports. However, persistent rates of new Covid-19 infections and a potential worsening of the China-U.S. trade conflict cloud the outlook. FocusEconomics panelists see the economy expanding 2.7% in 2021, which is unchanged from last month’s forecast, and 1.6% in 2022.
Japan Economy Data
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|Bond Yield||-0.02||-4.41 %||Dec 30|
|Exchange Rate||108.7||-0.35 %||Jan 01|
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Japan Economic News
July 21, 2021
Yen-denominated merchandise exports jumped 48.6% annually in June, hot on the heels of May’s 49.6% upturn, which had marked the strongest increase in over 30 years.
July 20, 2021
Core consumer prices increased 0.10% in June over the previous month, moderating from May's 0.20% increase.
Japan: Bank of Japan holds policy steady at July meeting; fleshes out measures to address climate change
July 16, 2021
At its meeting ending on 16 July, the Bank of Japan (BoJ) kept its monetary policy unchanged, as widely expected by market analysts.
July 12, 2021
Core machinery orders—which cover the private sector, exclude volatile orders and are a leading indicator for capital spending over the coming three-to-six-month period—rose 7.8% in month-on-month seasonally-adjusted terms in May, which was above April's 0.6% increase and marked the best result since October 2020.
July 1, 2021
Business sentiment among large manufacturers—according to the Bank of Japan’s closely watched Tankan survey—came in at plus 14 in Q2, up markedly from the plus 5 reading clocked in Q1 but marginally below market expectations of a plus 15 reading.