Japan

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.

Japan’s inflation has hit 4% for the first time in more than four decades, an outcome likely to keep speculation of a monetary policy change smoldering as prices grow at twice the pace targeted by the Bank of Japan, Bloomberg News reported. Consumer prices excluding fresh food rose 4% in December from a year ago, the internal affairs ministry reported Friday. The result matched economists’ estimate, and was led by further gains in energy and food costs.

Japan recorded a record high trade deficit for 2022 of 19.97 trillion yen ($156 billion) as energy imports surged, the Finance Ministry said Thursday, the Associated Press reported. The deficit was the biggest since Japan began keeping comparable records in 1979, the ministry said. Both imports and exports jumped to record highs. Exports, led by autos, rose 18% from the year before, to 98 trillion yen ($766 billion). Imports, including oil, coal and natural gas, rose 39% on year to 118 trillion yen ($922 billion).

Coinbase Global Inc. is halting its operations in Japan due to volatile market conditions, the cryptocurrency exchange said on Wednesday, days after it announced job cuts amid waning demand for digital assets, Reuters reported. The move comes just weeks after rival exchange Kraken said it was ceasing its business in the country. "Japan is unlikely a material contributor to Coinbase revenue," Oppenheimer analyst Owen Lau said, adding the company has been examining the market for some time but just got the license from the Japanese regulator a year and a half ago.

The Bank of Japan kept its interest-rate targets unchanged Wednesday despite strong pressure from investors on the bank’s new 0.5% cap for the 10-year government bond yield, the Wall Street Journal reported. The Japanese central bank decided to leave short-term interest rates at minus 0.1% and its target for the 10-year Japanese government bond yield at around zero. The bank reiterated that it intends to cap that yield at 0.5%. In a surprise move on Dec. 20, the BOJ lifted the cap to 0.5% from the previous ceiling of 0.25%. While Gov.