Tetsushi's Feed
Aug 28, 2014

Japan’s Abe faces another bruising debate over raising sales tax

TOKYO (Reuters) – Prime Minister Shinzo Abe faces a hard choice in coming months: whether to hike Japan’s sales tax again, raising the risks of damaging a fragile recovery, or to back off and shake markets’ confidence in his commitment to curbing runaway government debt.

After the economy stumbled into its deepest quarterly contraction in three years when Abe raised the tax in April, senior government officials are broaching the possibility of delaying a planned further increase in a bid to keep the recovery on track.

Aug 27, 2014

Japan vice econmin: More caution needed on next tax hike

TOKYO (Reuters) – Japan’s government needs to be more cautious about a coming decision on raising the national sales tax than it was on the previous hike as the economy reaches a “make-or-break point,” a senior government official said on Wednesday.

Vice Economy Minister Yasutoshi Nishimura told Reuters he was concerned that the drag on consumption from the April 1 tax hike is proving prolonged, saying the government stands ready to roll out fresh fiscal stimulus to support the economy.

Aug 27, 2014

Japan vice economic minister: More caution needed on next tax hike

TOKYO (Reuters) – Japan’s government needs to be more cautious about a coming decision on raising the national sales tax than it was on the previous hike as the economy reaches a “make-or-break point,” a senior government official said on Wednesday.

Vice Economy Minister Yasutoshi Nishimura told Reuters he was concerned that the drag on consumption from the April 1 tax hike is proving prolonged, saying the government stands ready to roll out fresh fiscal stimulus to support the economy.

Aug 26, 2014

BOJ to stay bullish on prices even as it cuts Japan GDP estimate: sources

TOKYO (Reuters) – The Bank of Japan is likely to keep its bullish inflation outlook even as it cuts its economic growth forecast for this fiscal year in an October report, sources said, suggesting that the bank will not ease policy further at least until the end of 2014.

But central bankers are hardly complacent as they remain concerned about the outlook for exports, a soft spot in the economy that has failed to pick up despite the boost from a weak yen that gives Japanese goods a competitive advantage overseas.

Aug 21, 2014

Japan manufacturers’ mood, output rise, outlook dims

TOKYO (Reuters) – Japan’s manufacturers reported improving confidence and growth in new orders from domestic and export customers in August, but the service sector’s mood soured for a second straight month, reflecting a patchy economic recovery from April’s sales tax rise.

The Markit/JMMA flash Japan Manufacturing Purchasing Managers Index (PMI) rose to a seasonally adjusted 52.4 in August, up from a final reading of 50.5 in July as activity accelerated, sending the index further above the 50 threshold that separates expansion from contraction.

Aug 21, 2014

China, Japan Aug factory surveys signal economic softness

BEIJING/TOKYO, Aug 21 (Reuters) – China’s manufacturing
activity hit a three-month low in August, raising the case for
fresh policy steps to keep growth on track, while a Reuters poll
showed Japan’s economic recovery is likely to be modest despite
an small acceleration the factory sector.

Surveys conducted by HSBC/Markit and Reuters highlighted
fragility in recovery of the world’s second- and third-largest
economies at a time when policymakers try to walk a fine line
between supporting growth and pushing structural changes.

Aug 21, 2014

Japan manufacturers’ mood up, outlook dims: Reuters Tankan

TOKYO (Reuters) – Confidence at Japanese manufacturers inched up in August to mark the first improvement since April, but the service sector’s mood soured for the second straight month, a Reuters poll showed, reflecting a tame economic recovery from April’s sales tax rise.

While the service-sector mood is seen rebounding over the coming three months – suggesting the pain of the tax hike is easing – manufacturers’ sentiment is expected to slide, possibly reflecting weakness in external demand and factory output.

Aug 14, 2014

Japan second quarter machinery orders plunge; weak outlook challenges policymakers

TOKYO (Reuters) – Japan’s core machinery orders tumbled in April-June at their fastest since the last global financial crisis and only a modest rebound is seen in the current quarter – further challenging policymakers contending with a fragile economy.

The highly volatile data point, a key indicator of capital spending, followed news on Wednesday that the economy suffered its biggest contraction since 2011 in the second quarter as April’s sales tax hike took a heavy toll on private consumption.

Aug 14, 2014

Japan machinery orders rebound in June, but trend looks weak

TOKYO (Reuters) – Japan’s core machinery orders rose for the first time in three months in June after a record plunge in May, but weak exports and industrial production cloud the outlook for the capital spending needed to sustain economic growth.

The highly volatile data point, seen as a key indicator of capital spending, followed news on Wednesday that the economy suffered its biggest contraction since March 2011 as April’s sales tax hike took its toll on private consumption.

Aug 13, 2014

Japan Q2 economy contracts annualised 6.8 percent as tax hike bites

TOKYO (Reuters) – Japan suffered its biggest economic contraction since the devastating March 2011 earthquake in the April-June quarter as a sales tax hike took a heavy toll on household spending, stoking fears that any rebound may be too modest to sustain a solid recovery.

While the soft data is unlikely to shake the Bank of Japan’s conviction that the economy can ride out the tax hike impact, it could add pressure on the bank for further monetary easing if weakness in exports and consumption is prolonged.