2025-12-14 13:38Market Performance - The Tokyo Stock Exchange Index reached a historical high with a 1.8% increase, while the Nikkei 225 Index rose by 0.7% from December 8 to December 12, 2025[1] - The automotive and transportation equipment sector showed the highest growth, while the commercial and wholesale trade sector experienced declines[2] Interest Rate and Bond Market - The Bank of Japan is considering raising the policy interest rate from 0.5% to 0.75%, the highest level since 1995[1] - The 10-year Japanese government bond yield peaked at 1.970%, the highest since June 2007, and closed at 1.947% on December 12, 2025[1] - The total sales of Japanese government bonds aimed at individual investors reached 5.28 trillion yen in 2025, a 30% increase year-on-year, marking the highest level since the 2007 financial crisis[1] Economic Outlook - Japan's GDP contracted by 0.6% quarter-on-quarter and 2.3% year-on-year for the July to September period, with housing investment and exports negatively impacting the overall data[1] - The forecast for Japan's GDP growth for fiscal years 2025, 2026, and 2027 is 1.0%, 0.9%, and 0.7% respectively, with expectations of a boost in consumption spending in 2026[1] Federal Reserve Actions - The Federal Reserve lowered the federal funds rate by 25 basis points to a target range of 3.5% to 3.75%, marking the third consecutive rate cut since September 2025[1] Corporate Investments - Over 20 companies, including Honda and Canon, are set to invest between 5 billion and 20 billion yen each in Rapidus, a company focused on producing advanced semiconductors in Japan[1]