Japan

The Bank of Japan intends to maintain easy monetary policy and the government's energy assistance programme will hold down inflation, the central bank's governor Haruhiko Kuroda told a news conference at a G20 event on Thursday, Reuters reported. The governor expects inflation to be below 2% for fiscal 2023 and fiscal 2024, adding that Japan is no longer in a deflationary environment. Given that import prices have fallen, the Japanese government's energy assistance will aid in holding down inflation, Kuroda said.

The Japanese subsidiary of bankrupt cryptocurrency exchange FTX said it started allowing customers to withdraw their assets on Tuesday, a relatively quick reboot that Tokyo regulators see as the fruit of their strict crypto laws, the Wall Street Journal reported. The situation in Japan contrasts with the U.S. and other countries, where most FTX customers are a long way from getting access to their assets more than three months after the exchange’s U.S. bankruptcy filing. Japan, which was burned by the collapse of the early cryptocurrency exchange Mt.

Japan's manufacturing activity contracted at the fastest pace in 30 months in February, a business survey showed on Tuesday, in a worrying sign for the world's third-largest economy, which is facing weakening demand and struggling to tame cost pressures, Reuters reported. The au Jibun Bank flash Japan manufacturing purchasing managers' index (PMI) fell to a seasonally adjusted 47.4 in February, from a final 48.9 in the previous month.

The next boss of Japan’s central bank may eventually chart a course away from the “yield-curve control” policy championed by the ancien regime. But investors probably shouldn’t expect a radical change in Japan’s monetary policy overnight, the Wall Street Journal reported. The Japanese government on Tuesday nominated Kazuo Ueda to become the next governor of the central bank, confirming last Friday’s media reports of the surprise pick. Current governor Haruhiko Kuroda, who oversaw a program of aggressive and unorthodox monetary easing, will end his 10-year stint in April.

Japan’s currency is resisting the urge to join in on a period of relative calm, Bloomberg News reported. Volatility has stayed high ever since the Bank of Japan lifted the cap on Japanese bond yields in December. Uncertainty about the outlook of future policy moves is keeping yen traders on edge more so than their counterparts who trade other global assets, including Japanese equities. The yen initially strengthened on Friday after a report that Japanese Prime Minister Fumio Kishida will nominate Kazuo Ueda to take the helm of the central bank.

Japan's government is likely to appoint academic Kazuo Ueda as the next Bank of Japan governor, two government officials told Reuters, a surprise choice that could see the country finally align with other major economies in raising interest rates, Reuters reported. Ueda, a former BOJ policy board member and an academic at Kyoritsu Women's University, is considered an expert on monetary policy but had not even been seen as a dark horse candidate for the top job.

The bankrupt FTX group of cryptocurrency companies extended the deadlines to bid for its Japan and Europe businesses as administrators strive to raise funds to help pay back creditors, Bloomberg News reported. The preliminary bid deadline is now March 8 and the auction date becomes April 26, according to a court filing on Wednesday. Administrators in December put several FTX units on the auction block, including LedgerX, the Japanese and Singaporean crypto exchanges, and the European digital assets and derivatives business.

Japan’s government cut its monthly economic assessment in January for the first time in 11 months, as trade weakened due to a global economic slowdown, Bloomberg News reported. The Cabinet Office said in its latest report Wednesday that parts of the economy are showing weakness, while overall it’s picking up moderately. It downgraded its view of exports, imports and bankruptcies. Japan is bracing for the impact of a global economic slowdown from aggressive monetary policy tightening, and the fallout from China’s abrupt end to its zero-Covid policy.

Japan raised its estimates for long-term interest rates over the coming few years in government's twice-yearly fiscal projections issued on Tuesday, following the central bank's decision last month to allow 10-year bond yields to move more widely, Reuters reported. Higher rates will test the government's ability to service the industrial world's heaviest debt burden at more than double the size of Japan's annual economic output.

Japan's finances are becoming increasingly precarious, Finance Minister Shunichi Suzuki warned on Monday, just as markets test whether the central bank can keep interest rates ultra-low, allowing the government to service its debt, Reuters reported. The government has been helped by near-zero bond yields, but bond investors have recently sought to break the Bank of Japan's (BOJ) 0.5% cap on the 10-year bond yield, as inflation runs at 41-year highs, double the central bank's 2% target.