December 17, 2019

Japan’s new policy mix

Share on facebook
Share on twitter
Share on linkedin
Share on email

In Short

After the October sales tax hike from 8% to 10%, indicators have come in mixed. The BoJ’s Tankan survey showed business confidence at large manufacturers dropping. We continue to expect a negative GDP growth rate in Q4.
Japan’s new policy mix
Share on facebook
Share on twitter
Share on linkedin
Share on email

Highlights:

  • Japan revised its Q3 GDP growth up from 0.2% to 1.8% qoq ann. Accordingly, we lifted our 2019 GDP forecast slightly up to 1.1%.
  • After the October sales tax hike from 8% to 10%, indicators have come in mixed. The BoJ’s Tankan survey showed business confidence at large manufacturers dropping. We continue to expect a negative GDP growth rate in Q4.
  • In order to minimize the risks after the tax hike but also to avoid a cliff edge after the Tokyo Olympics next summer, PM Abe announced a stimulus package with a headline figure of JPY 26tr (4.7% of GDP). Actual fiscal measures will be much lower with JPY 13.2 tr and the impact on the economy even smaller. We revised our growth outlook upwards to 0.6% next year.
  • With the new policy package, Japan shifted to a new policy mix. We expect the BoJ to hold its monetary policy constant on its next meeting (December 18/19) and at least during the next year.

Download the full publication below

JAPAN’S NEW POLICY
MIX

Also interesting

Blue-sky-white-clouds-temperature-hot-thermometer
00:06:05
April 7, 2021
Podcast

The Spotlight ǀ Generali Investments Podcast: Some like it hot

abstract-highway-bridge-background-picture-id1131330933 (1)
April 2, 2021
Real Assets

Generali Real Estate ǀ Interview with Aldo Mazzocco, CEO

size 3
April 1, 2021
Market Commentary

COVID-19 UPDATE Facts & Figures