Core Viewpoint - Inflation in Japan's capital has decreased below the central bank's 2% target for the first time in over a year, but this slowdown is not expected to halt further interest rate hikes [1] Group 1 - The inflation rate in Tokyo has cooled, indicating a potential shift in economic conditions [1] - The central bank's target of 2% inflation has not been met, suggesting a change in the inflationary environment [1] - Despite the cooling inflation, the central bank is likely to continue with interest rate increases, reflecting a commitment to monetary policy tightening [1]

By Leika Kihara TOKYO, Feb 26 (Reuters) - Japanese Prime Minister Sanae Takaichi's choice of two like-minded monetary doves to the central bank's board sends a not-so-subtle message about her distaste for higher interest rates, casting doubt on how much further policy can be tightened. The Ministry of Finance, which in the past had been involved in forming a list of candidates for the ‌post, was kept out of the loop with the premier holding her choice close to her chest, two sources familiar with the mat ...

Core Viewpoint - The Bank of Japan is expected to raise interest rates sooner rather than later, as deflation is no longer a concern, according to policy board member Hajime Takata [1] Summary by Relevant Categories Monetary Policy - The Bank of Japan's path to increasing interest rates is now clear following the end of deflation [1]

Investor capital is circulating globally, with Japan and emerging markets ETFs gaining traction as trade policy uncertainty makes a comeback.About $1 billion was injected into the iShares MSCI Japan ETF (NYSE:EWJ) last week, while the Vanguard FTSE Emerging Markets ETF (NYSE:VWO) attracted around $949 million. These two separate inflows indicate that investors are diversifying their portfolios beyond U.S. stocks during a period when tariff agreements related to President Donald Trump's policy agenda are aga ...

By Leika Kihara TOKYO, Feb 23 (Reuters) - The Bank of Japan may raise interest rates as soon as March if the yen renews its slide ahead of a U.S.-Japan summit expected to be held during the month, former central ‌bank board member Makoto Sakurai told Reuters. Prime Minister Sanae Takaichi is expected to visit Washington for a meeting with U.S. ‌President Donald Trump around the time the BOJ holds its next policy meeting on March 18-19. Takaichi may seek the BOJ's help in keeping yen falls in check, as ...

Shop owners of a 70-year-old "takoyaki", or octopus balls, restaurant chat while cooking along a street in the Taito Ward area of Tokyo on February 21, 2025.Japan's headline inflation rate fell to 1.5% in January, its lowest level since March 2022. The reading ended a run of 45 straight months in which inflation had remained above the Bank of Japan's 2% target.Core inflation rate, which excludes fresh food prices, eased to 2%, the lowest level since January 2024 and matching the 2% forecast by economists po ...

Prime Minister Sanae Takaichi faces a decision on whom to tap for spots opening on the Bank of Japan’s board, nominations that will give economists and investors an indication of how she hopes to influence central bank policy https://t.co/2Vq5Dafx0K ...

By Leika Kihara TOKYO, Feb 18 (Reuters) - The International Monetary Fund urged Japan to keep raising interest rates and avoid loosening fiscal policy further, warning that trimming the consumption tax would erode its capacity to ‌respond to future economic shocks. The recommendation came as dovish Prime Minister Sanae Takaichi's landslide election win heightens ‌market attention to whether she will push back against further rate hikes by the central bank. It also follows Takaichi's pledge to suspend by ...

Economic Trends - China's consumer-price index has remained stagnant since mid-2022, with GDP growth declining from 8.6% at the beginning of the century to 5% currently, largely due to a shrinking population from the one-child policy [1] - Major economies, except for the U.S. and India, are experiencing population declines, leading to systemic downward pressure on currencies and economies, while gold prices are expected to rise as a hedge against this economic downturn [3][4] Cryptocurrency Market - Cryptocurrencies, once seen as a hedge against economic decline, are losing credibility among institutional investors due to significant bid/ask spread issues, prompting a shift towards gold as a safer investment [2] Central Bank Policies - Central banks are primarily focused on combating inflation but lack effective tools to address deflation, which is becoming a pressing issue as population declines exert downward pressure on prices [5] - The Bank of England may have to implement quantitative easing and lower interest rates in response to Britain's economic challenges, which could further devalue the British pound [13] Global Currency Dynamics - The Japanese yen is under pressure due to a declining birth rate and high government debt, which is complicating the Bank of Japan's efforts to manage the economy through quantitative easing [9] - The euro is facing challenges from internal EU dynamics and rising anti-EU sentiments, which could undermine its value amid poor GDP growth and population decline [16] U.S. Economic Resilience - The U.S. benefits from a younger demographic and a competitive state system that fosters economic growth, contrasting with the stagnation seen in other major economies [17][18] - Despite a stable population growth rate, the U.S. fertility rate has been below 2.0 since 2010, indicating potential future challenges [19] Investment Outlook - Investors are increasingly turning to gold and the U.S. dollar as hedges against currency declines and deflationary pressures, with gold prices projected to reach $10,000 per ounce by the end of the decade [20]

Japan’s five-year government bond auction drew weaker demand than its 12-month average as investors mull the outlook for fiscal policy and the Bank of Japan’s rate-hike path https://t.co/oH8p8boU30 ...