KUALA LUMPUR, March 21 (Bernama) -- Bursa Malaysia’s benchmark index ended the day marginally higher supported by renewed buying interest in blue-chip stocks, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) gained 1.29 points to 1,505.45 from Thursday’s close of 1,504.16. The benchmark index opened 0.29 of-a-point lower at 1,503.87 and moved between 1,503.71 and 1,513.23 throughout the day. On the broader market, losers outpaced gainers 513 to 371 while 428 counters were unchanged, 1,125 untraded, and 29 suspended. Turnover rose to 3.43 billion units worth RM4.28 billion from 3.27 billion units worth RM2.64 billion on Thursday. UOB Kay Hian Wealth Advisors Sdn Bhd head of investment research Mohd Sedek Jantan said buying interest was seen particularly within defensive sectors such as utilities, healthcare, and banking during the morning session.
Key Takeaways:
Record Cash Decline: Japanese households reduced their collective cash holdings by 3.4% year-on-year, marking the largest drop since the Bank of Japan (BOJ) began tracking this data in 1998. By the end of December, their total cash holdings had fallen to ¥105.3 trillion (approximately US$707 billion or RM3.11 trillion).
Inflation and Spending: The drop in cash is largely attributed to rising living costs as inflation impacts household finances. This comes after a period of cash hoarding during the Covid-19 pandemic, which saw a surge in cash savings.
Cashless Trend: The shift towards cashless payments is contributing to the reduced need for physical cash. The adoption of digital payments and increased consumer spending are driving the change in how Japanese citizens handle their money.
Rise in Investments: While cash holdings are declining, investment assets are on the rise. Investment trust holdings hit a record high, and individual investments in Japanese government bonds have also surged, marking the biggest jump since 2007.
Inflationary Pressure: Japan’s inflation continues to outpace expectations, remaining well above the BOJ’s 2% target. In response to higher living costs, consumer spending reached a new high, amounting to ¥332.9 trillion last quarter, though this figure has not been adjusted for inflation.
What This Means for Japan's Economy:
With inflation lingering and consumer spending rising, Japanese households are increasingly looking for ways to preserve the value of their wealth. The move away from cash and toward investments like government bonds and trusts reflects growing concern over the impact of inflation on purchasing power. While cashless payments gain popularity, the wider shift to investment could indicate a change in long-term financial behavior among Japanese households.
As Japan continues to emerge from deflationary pressures, the balance between inflation, spending, and investments will likely shape the economic landscape in the coming months.
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