The Japanese yen has reached the top hitting a 17-month high on Tuesday. The appreciation takes place following advice from Japanese Prime Minister for cautious market intervention by authorities. Addition of value to yen cause downward trend in Nikkei average index on the same day leading towards a 18% drop during this year.
Japanese economy has been witnessed to go through sluggish growth rate. To boost up the economic growth, Prime Minister Shinzo Abe has been planning for announcing a stimulus package of new spending measures. Meanwhile, a Nikkei Inc./ TV Tokyo conducted poll shows that support for Abe’s economic reforms has been witnessed to rise by 8% to 55%.
The turbulent situation Japan's banking sector is likely to impact global markets. A leading hedge fund manager says that collapse in the Japan's banking industry blindsides the market, while shrugging off any possibility of banking crisis in the world's third largest economy.
Through a surprise move, Bank of Japan has adopted negative interest rate aiming to force the banks in investment. Meanwhile, the negative economic outlook has compelled the commercial banks to squeeze their investment portfolios while diminishing the BOJ move. Analysts have forecast for unchanged monetary policy in Tuesday’s meeting while predicting for a major change in April.
Global stocks rose further as increased investor confidence propelled buying support. Investor confidence has been strengthened after the announcement of European Central Bank's stimulus plans and encouraging US economic data.
Japan's regional banks are enhancing unsecured retail lending as it offers high profit margins. Loans on mortgage and small firm borrowing are declining. Japan banks are suffering from ultra-low interest rate regime to increase revenues.
The Bank of Japan is reportedly anticipated to reduce its price and economic outlooks for the next fiscal years at a quarterly appraisal that is scheduled in April. The bank is trimming its growth outlook citing the failure of its previous stimulus pack.
The Bank of Japan is anticipated to reduce its interest rates into a negative territory further at or before the bank's meeting in July. The bank is anticipated to trim its interest rate to minus 0.2% due to low domestic spending and slump in the energy market.
Bank of England has many choices to boost Britain's economy. The bank may slack its financial policy on fears that the country may exit the European Union.
Global stocks hike starting Monday. Investors are anticipating the G20 meeting which to be held in Shanghai on Friday.
Koji Ishida, Bank of Japan's policy board members said the negative interest rate will do very little to boost investment. Continuing tumult in the market may hurt Japanese economy.
The economy of Japan shrank during the fourth quarter of 2015 as a result of weak export and demand. The shrinking population also added to the economic slowdown.
The economy of Japan struggled last month according to a wave of data released by the Bank of Japan. The industrial production was down 1.4% over the prior month.
Japan's economy continues to decline. Inflation rate and household spending crawled in July. This is according to data that was released onFriday that will possibly add pressure on the central bank to raise its barrage of monetary stimulus.
Factory worker Satomi Iwata has new co-workers, a troupe of humanoid automata that are helping to address two of Japan's most pressing concerns - a shortage of labor and a need for growth.