East Asia Econ

Japan – Ueda becomes constructive again

The tone of governor Ueda's speech today suggests a rate hike is close. He claims that risks to the US are receding, identifies five recent positive wage developments, and with firms' price and wage behaviour changing, argues that exchange rate changes are more likely to affect prices.

Paul Cavey

Dec 1, 2025 • 5 min read

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Region – manufacturing PMIs and Korean exports

The mfg PMIs across the region mainly remain below 50. That shows that conditions outside of semiconductors remain poor. Semi is strong, and in Korean in export data for November, are departing from a normal cycle. Goods input prices pressures are rebounding, reflecting weak currencies.

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Last week, next week

The main themes: stabilisation in China, but the picture is muddy; the discrepancy between clear economic boom in Taiwan versus stability in inflation and TWD; upside risks in Korea that still look like risks than reality; the BOJ facing a real fiscal boost when the economy is already recovering.

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China – more data puzzles

The official composite output PMI in November fell below 50. That wasn't because of FAI: the industrial PMIs were stable. Rather, it was weakness in services. That is puzzling. For now, the one concrete indicator from today's inflation is actually positive: deflation isn't getting worse.