Investors Game Out Stagflation Risk in Japan as Oil Prices Rise

That leaves the Bank of Japan facing a difficult trade-off: tighten policy to support the yen and contain inflation expectations, or hold back to avoid undermining growth that helped stocks to fresh record highs last month. It also risks exacerbating fiscal concerns, which are already elevated after Prime Minister Sanae Takaichi's election victory, as a stagflation shock could prompt additional government spending. (Bloomberg) -- Some investors are starting to position for a scenario Japan hasn't faced in d ...