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Japan

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This Is Only The Beginning For The Bank Of Japan

The Bank of Japan delivered a historic policy adjustment this week, ending both negative interest rates and Yield Curve Control. In this Insight, BCA’s global fixed income and currency strategists discuss the immediate implications of the move for Japanese bond yields and the yen, and the potential for additional tightening actions.

Global Fixed Income Strategy, Foreign Exchange Strategy by Chester Ntonifor
BoJ: A One-And-Done Rate Hike?
The Bank of Japan pulled its policy rate out of negative territory with a 10-basis point rate hike on Tuesday that brings the BoJ’s overnight interest rate to a range of 0% to 0.1%, ending over a decade of ultra-accommodate monetary policy. The central bank…
Daily Insights
Japan: Q4 GDP Expansion Raises Odds Of BoJ Hike
Japanese equities and government bonds sold off on Monday and the yen strengthened following the release of the revised Q4 GDP report showing the economy expanded by an annualized 0.4% q/q in Q4 2023 versus earlier estimates of a 0.4% contraction. A…
Daily Insights
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Monthly Portfolio Update: Recession Thesis Remains Intact

Amid patchy global growth, the US economy remains resilient. However, tight monetary policy will eventually trigger a recession in the US too. The stock market rally has been very narrow. Stay underweight risk assets.

Global Asset Allocation by Garry Evans
BoJ: Nearing The End Of Negative Rates?
Japan’s CPI inflation dropped from 2.6% to 2.2% y/y in January. However, the sharp slowdown comes on the back of falling energy prices. Meanwhile, the BoJ’s core-core measure of underlying inflation (CPI excluding fresh food and energy) eased from 3.7% y/y to…
Daily Insights
Irrational Exuberance?
Nvidia’s blowout Q4 2023 earnings results and bullish guidance catalyzed a rally in global stocks that pushed the S&P 500, Europe’s Stoxx 600, and Japanese Nikkei to record highs on Thursday. The S&P 500 is already expensive. It is true that Big…
Daily Insights
Japan's Export Surge: Less Than Meets The Eye
Japanese exports in JPY increased by 11.9% y/y in January, up from a 9.7% y/y increase in December and surpassing expectations of 9.5% y/y. A 29.2% y/y jump in exports to China led the overall surge. Trade data from Asian export-oriented economies are…
Daily Insights
Does The Japanese Equity Rally Have Legs?
Japanese equities have outperformed their global peers since September 2022 in common currency terms. Over this period, the Nikkei 225 and the TOPIX posted gains of close to 50%. A weak yen has boosted Japanese multinationals’ foreign revenues and prompted…
Daily Insights
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It’s A Good Time To Buy Inflation Insurance

Could a second wave of global inflation be underway? The latest inflation prints in the US and UK showed upside surprises, while there is evidence of increased price pressures in global manufacturing. Combined with the improvements seen in economic sentiment measures and leading economic indicators in the US and Europe, and potential upside risks to oil prices, we see a strong case for owning more inflation protection in global bond portfolios. Inflation-linked bonds look attractive in this environment, especially in the US.

Global Fixed Income Strategy
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Monthly Portfolio Update: Waiting For The Recession

When will the US also buckle under high rates? We expect a US recession to begin around mid-year. Stay defensive.

Global Asset Allocation by Garry Evans

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