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Japan – May trimmed mean CPI
Today's trimmed mean measure of CPI is broadly consistent with the BOJ's assessment that inflation in Japan still lacks broad-based momentum.
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Japan – May CPI
The acceleration in inflation of the last few months stalled in May, with both core and headline unchanged. The leading indicators aren't yet suggesting a re-acceleration, with a softening of commodity prices offsetting the weakness of the JPY.
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Japan – May services PPI
As with other inflation indicators, May service PPI shows price pressures running at multiyear highs. But the pick-up of the last couple of months is narrow, concentrated in international transport costs, which in turn related to the rise in energy prices.
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The East Asia Economist
The BOJ is under pressure, but Japan isn't in crisis. Rising energy prices hurt, but ending YCC would be painful too. Instead, it is probably better to focus on economic normalisation post-covid. That would likely include an influx of tourists concluding that, with the JPY at 135, Japan is cheap.
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Japan – Q2 BSI survey
The BSI survey suggests that the economy remains on a recovery path. There aren't signs of a big acceleration in growth, but nor are there indications that the headwinds in the world economy and depreciation of the JPY are causing Japanese firms to turn pessimistic.
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Japan – BOJ meeting
The BOJ didn't move today, and while the central bank is facing strong market pressure to move, so far at least, there's not so much domestic political pressure.
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Japan – May exports
Exports in volume terms remain elevated compared with history. But JPY weakness means a lot of variation in export values, and also a rapid rise in the import bill.
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Japan – April machine orders
Machine orders in April were surprisingly strong, and suggest some resilience in both exports and domestic capex.
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Japan – May EW survey
Despite all the headwinds, the outlook for the economy looks quite solid, with RGDP likely to be growing 2-3% YoY in the next few months.
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Japan – Q1 profits
Profits declined in Q1 as input prices rose. Non-manufacturing margins, however, remain fairly high, and overall capex growth in Q1 was stable at 3% YoY.
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Japan – May consumer confidence
Consumer sentiment remains very weak. However, a turn up is starting to take shape, and that could gain real momentum if the April-May moderation in inflation expectations continues, and a further relaxation of covid restrictions encourages a more vigorous recovery in services activity.
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Japan – April labour market
The labour market data in April were positive, albeit more in the sense that the labour market is growing rather than necessarily tightening. That's good for aggregate earnings, but means a rise in individual pay might still be some way away.
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Japan - May Tokyo CPI
There's probably a bit more upside in CPI from here, but data for Tokyo in May fit with the idea that inflation momentum is starting to ease.
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Japan – April services PPI
Headline services PPI accelerated sharply in April to 1.6% YoY, then highest since at least the 1990s. But that was mainly due to the surging cost of international freight services. Domestic services inflation is rising, but more modestly.
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Japan – April trimmed mean CPI
Trimmed mean CPI rose again in April to a record high, and there's probably still a bit more upside ahead. But for CPI to take another meaningful step higher, the domestic labour market likely needs to tighten further.
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Japan – April CPI
CPI rose in April, with the BOJ's preferred measure rising above 2% YoY for the first time in Governor Kuroda's tenure at the BOJ. The leads now suggest a peaking, which if right, would likely be positive for domestic economic momentum.
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Japan – April exports
Headline YoY export data in April were reasonably firm. But exports fell quite sharply MoM. Downside risk for the regional export cycle is increasing.
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Japan – March machine orders
Japan's machine orders bounced in March, but not by enough to change the overall picture. That continues to look like a continuation of the sluggish recovery in domestic capex of recent months, and export growth slowing to zero.
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Japan - Q1 GDP
Q1 GDP data show no change in Japan's sluggish recovery out of Covid-19. The leads suggest GDP bounces in the next 3M, which is believable, given the potential for better domestic services activity. At the same time, the downside risks for exports appear to growing.
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Japan – April EW survey
The Economy Watchers survey was solid in April, which suggests a constructive outlook for the cycle, with perhaps a touch of upside risk compared with the other advanced economies.
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Japan - April Tokyo CPI
Overall CPI inflation in Tokyo rose to 2.5% YoY in April. The measure of all items less food, which is the official target for the BOJ, reached 1.9% YoY, which excluding the sales-tax boosted inflation of 2014, was the highest in several decades. A lot of this reflects rising energy prices, a trend which more recently has started to fade. But core CPI (inflation excluding food and energy
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Japan - April consumer confidence
Consumer confidence managed to improve in April, but just a touch. The optimistic argument would be this is just the beginnings of a more sustained lift as recovery in the services industry from covid finally gets under way.
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Japan - April BOJ meeting
With the procyclicality that is built into YCC, not tightening when inflation is rising elsewhere and other central banks hiking necessitates the BOJ stepping up loosening. And that's exactly what the BOJ did at its monetary policy meeting today.
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Japan - March labour market
It would be tempting even to describe the labour market situation as goldilocks - except that the BOJ wants inflation to rise, and without that actually happening, the bank will keep policy loose, in turn putting pressure on the JPY to depreciate.
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Japan - March trimmed mean CPI
The BOJ's calculation of trimmed mean CPI moved up in March to 1.1% YoY, equal with the previous record high in the series last reached in 2008. The details though were a little soft.