Japan – more evidence of a shift

The one-off firm survey undertaken as part of its long-term policy review has allowed the BOJ to reiterate its positive stance, and provide more of the evidence underpinning it.

Japan – inflation up, labour market tightening

The BOJ has been expressing confidence that inflation is getting to 2%. The Tankan can only reinforce that: the labour market tightened, and output prices rose again. The BOJ should be tightening.

Japan – no change in the Tankan

There's nothing in the Q2 Tankan to change the BOJ's view of the economy, with sentiment stable, the labour market tight, and inflation elevated. Separately, consumer confidence in June ticked up.

Japan – core Tokyo CPI still close to 2%

Today's data releases show stronger Tokyo inflation, headline and core; no big change in the labour market; and a rise in IP.

Japan – firm upstream services inflation

April SPPI was revised down, but the SAAR through May remains around 4%. With wage growth up, the BOJ's new measures of SPPI by labour content suggest inflation remains well-supported.

Japan – self-generated stagflation

Catching up on wages, inflation, activity and the BOJ. Overall, growth is weaker, and inflation stronger, trends that are likely to intensify after the bank's lack of action earlier this month.

Region – BOJ and CBC

Given the confidence the bank has been expressing, the BOJ meeting this week was disappointing. By raising the RRR, Taiwan's CBC, by contrast, was somewhat hawkish.

Japan – not data dependent

Of course, headline data matter. But not as much in Japan as elsewhere. Official data don't suggest a tightening economy, but in the last 6M, the BOJ has nonetheless become more confident that Japan is heading to sustainable inflation. We'd expect more rate hikes soon.

Japan – stronger wage growth, probably

Wage growth in Japan is solid, and the macro backdrop, such as today's services PMI, indicates is probably accelerating. However, the pick-up isn't showing up in all the data.