China, Japan and South Korea agreed on Sunday to restart cooperation and pave the way for a summit in the latest move to ease tensions between the Asian neighbours, Reuters reported. Even as China and the United States seek to mend frayed ties, including a summit this month between Presidents Xi Jinping and Joe Biden, Beijing is concerned that Washington and its key regional allies are strengthening their three-way partnership.
Read more
Japan's economy contracted in July-September, snapping two straight quarters of expansion on soft consumption and exports, complicating the central bank's efforts to gradually phase out its massive monetary stimulus amid rising inflation, Reuters reported. The data suggests stubbornly high inflation is taking a toll on household spending, and adding to the pain for manufacturers from slowing global demand including in China. "Given the absence of a growth engine, it wouldn't surprise me if the Japanese economy contracted again in the current quarter.
Read more
The pace of gains in Japan’s producer prices decelerated more than expected in October to the weakest in over two years, supporting the Bank of Japan’s view that inflation is cooling, Bloomberg News reported. A measure of input prices for Japanese firms rose 0.8% from a year earlier, the slowest pace of growth since gains resumed in March 2021, the Bank of Japan reported Monday. The data compared with economists’ expectations of a 0.9% increase year-on-year. From the prior month, prices fell 0.4%, compared to the consensus view of a 0% change.
Read more
The Bank of Japan may end its negative interest rate policy as early as January, and keep raising short-term borrowing costs if the economy can weather risks from overseas uncertainties, said former central bank executive Eiji Maeda, Reuters reported. The BOJ last month revised up its price estimates to project inflation to hit 1.9% in both fiscal 2024 and 2025, as measured by an index that strips away the effects of volatile fresh food and fuel costs.
Read more
Japanese manufacturers' business confidence improved for the first time since August while service-sector mood rose for a second month, according to the Reuters Tankan poll, which also highlighted a challenging outlook amid a patchy economic recovery, Reuters reported. The monthly poll mirrored a similar improvement seen in the third quarter in the Bank of Japan's (BOJ) closely-watched quarterly tankan survey.
The Unification Church’s Japanese branch announced plans Tuesday to set aside a fund up to 10 billion yen ($67 million) to cover possible compensation for those seeking damages they say were caused by the group’s manipulative fundraising tactics, the Associated Press reported. The move is seen as an attempt to allay any suspicion that the group would try to avoid later payouts by hiding assets overseas while a government-requested dissolution order is pending.
Japanese stocks have trounced their Chinese peers this year, but some investors are betting the tide is about to turn, Bloomberg reported. Headwinds are growing for Japanese equities, including deteriorating global growth and concern the era of yen weakness that has bolstered exporters’ earnings may be nearly over as the central bank comes under pressure to tighten policy. Conversely, optimism is building that Beijing’s efforts to bolster the economy and local equity markets will help end a slump that has made Chinese equities among the world’s worst performers this year.
Bank of Japan Governor Kazuo Ueda will continue to dismantle the central bank's ultra-easy monetary policy settings and look to exit the decade-long accommodative regime sometime next year, an inherently risky plan that would require skilful execution, Reuters reported. Ultimately, however, the BOJ chief's exit strategy will require a bit of good fortune too, especially given global uncertainties including the Middle East conflict and worries about whether the U.S. economy could achieve a soft landing as well as China's growth trajectory.
Read more
The Bank of Japan further loosened its grip on long-term interest rates by tweaking its bond yield control policy again on Tuesday, taking another small step towards dismantling its controversial monetary stimulus of the past decade, Reuters reported. While it kept ultra-low interest rates steady, the BOJ watered down its 1% cap on the 10-year bond yield which it set just three months ago to allow long-term borrowing costs to rise more.
Read more
Core consumer inflation in Japan's capital Tokyo, considered a leading indicator of nationwide trends, unexpectedly accelerated in October, a sign of broadening price pressures that may keep alive expectations of near-term end to ultra-low interest rates, Reuters reported. The data reinforces expectations the Bank of Japan (BOJ) will revise up its inflation forecasts when it produces fresh quarterly projections at next week's policy meeting.
Read more