The Bank of Japan is purchasing government bonds at a record pace this year, a factor that likely prompted its recent move to allow larger yield movements so as to reduce the strain on its control of longer-term interest rates, the Japan Times reported. Doubling the effective cap on benchmark yields in December and again last month has yet to significantly reduce the BOJ’s bond buying, raising the possibility that more changes will be needed to help rein in purchases.
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Japan’s economy recorded impressive growth in the second quarter of 2023, government data showed on Tuesday, evidence that the country is finally recovering from the Covid doldrums, even as signs of significant challenges remain, the New York Times reported. Economic output in Japan grew by an annualized rate of 6 percent in the second three months of the year, the country’s Cabinet Office said. It was the third consecutive quarter of expansion, following a revised reading of 3.7 percent growth in the January-to-March period and a slight bump of 0.2 percent the quarter before that.
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Kiyoshi Hashimoto's machinery factory outside Tokyo should be buzzing with industry. Instead, it's so quiet you can hear him practising the recorder. The 82-year-old entrepreneur founded his company nearly 40 years ago, but well past retirement age he has neither a successor nor a buyer for a business that retains loyal clients, the Japan Times reported. It is a problem that Japan's government warns could affect up to a third of all small businesses in the country by 2025, as the country's population shrinks and ages.
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Two of Japan’s largest lenders posted profits that beat analysts’ forecasts in their fiscal first quarter, marking a solid start to the year that is projected to deliver bumper results, Bloomberg News reported. Sumitomo Mitsui Financial Group Inc. said net income for the quarter ending June 30 was 248 billion yen ($1.75 billion), above an average estimate of 236.1 billion yen by six analysts. This was about 1.8% lower than the same period a year ago.
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The dovish Bank of Japan faced a tough two-day policy-setting meeting that started Thursday due to potentially changing inflation dynamics, with edgy financial markets seesawing over whether its controversial yield cap program will be modified.
The BOJ is widely expected to revise upward its earlier inflation forecast for the current fiscal year to next March, given more evidence that price hikes, initially prompted by surging fuel and raw material costs, have been broadening in a notable change for the once deflation-mired nation, the Japan Times reported.
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The U.S. dollar being the dominant global reserve currency has been on a slow long-term downward trend, interrupted by upticks — and now we had an uptick, when the dollar gained share, Wolf Street reported. The share of the USD as global reserve currency rose to 59.0% in the first quarter of 2023, after having dropped to 58.6% in Q4, which had been the dollar’s lowest share since 1994, according to the IMF’s recent COFER data. The U.S.
Some 27 percent of nursing homes and related service facilities in Japan may go bankrupt or shut down operations in a few years if soaring prices and utility costs continue to put pressure on them, according to a survey by nursing care groups, Kyodo News reported. "Nursing care facilities are not able to pass along cost increases to consumers in the same way as other companies, and this has a significant impact on their business," said an official of Minkaikyo, an association of nursing care providers.
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Japan's factory activity contracted in June after expanding for the first time in 7 months in May, a private survey showed on Monday, dragged down by weak orders for cyclical goods amid a global economic slowdown, Reuters reported. The final au Jibun Bank Japan manufacturing purchasing managers' index was at 49.8, returning below the 50.0 threshold that separates growth from shrinkage, after May's 50.6 reading. Output and new orders, the subindexes that constitute the majority of the headline index, fell back to contraction, ending a brief rebound buoyed by improved business confidence.
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Bank of Japan (BOJ) Deputy Governor Ryozo Himino said recent price rises were stronger than previously projected and inflation expectations were moving up, a sign the economy is getting closer to achieving the bank's 2% inflation target, Reuters reported. While stressing the need to keep ultra-loose monetary policy for now, Himino said the economy was beginning to see a mix of cost-push inflation and price gains driven by domestic demand. "The pass-through of rising imported goods prices is broadening with a lag.
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Japan’s crypto exchanges are pushing for a relaxation of curbs on margin trading, unbowed by last year’s global digital-asset market crash, Bloomberg News reported. Many people in the industry want permitted leverage for retail investors of four to 10 times whereas currently customers can at most double exposure via borrowing, according to the Japan Virtual & Crypto Assets Exchange Association.