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Asian Markets Rise Before US Jobs Report, Fed Comments Ease Rate-Hike Fears Asian equities moved higher on Friday as investors positioned themselves ahead of the crucial US August jobs report. The biggest shift came from Federal Reserve Governor Christopher Waller, whose comments reduced fears of an imminent US interest-rate hike and helped bonds recover, the US dollar weaken and the Japanese yen strengthen. 30-Second Market Snapshot 🇯🇵  Nikkei:  +0.8% 🇨🇳  China blue chips:  +1.0% 🇰🇷  Kospi:  +1.1% 🌏  MSCI Asia ex-Japan:  +1.0% 💵  US Dollar Index:  98.96 🇯🇵  USD/JPY:  around 155.7 🥇  Gold:  around US$4,470/oz 🛢️  Brent crude:  around US$95.52/barrel 🇺🇸  US 2-Year Treasury Yield:  4.34% 🇺🇸  US 10-Year Treasury Yield:  4.76% Big Story Today Markets are becoming slightly less convinced that the Federal Reserve will raise interest rates in September. Fed Governor Christopher W...

The long-held belief that a weaker yen benefits Japanese stocks is unraveling as the correlation between the two diminishes due to diverging global monetary policies. Key Developments Topix Stagnation: Despite the yen’s volatility, the Topix Index has remained range-bound since its summer crash. The correlation coefficient between the yen and Topix is near zero, indicating negligible linkage. BOJ’s Policy Shift: The Bank of Japan (BOJ) shifted focus in May to curb inflation driven by a weak yen, rather than stimulating a virtuous cycle of wages and prices. Foreign investors have been net sellers of Japanese stocks since this shift. Impact of BOJ Hawkishness: A weaker yen now signals potential BOJ rate hikes, which depress stock valuations. The BOJ’s hawkish stance contrasts with expectations of rate cuts by the US Federal Reserve, creating further headwinds for Japanese equities. Changing Dynamics of the Japanese Economy Export Dependency Declines: Japan’s economy, long perceived as ...

Key Takeaway: Japan’s economy expanded by an annualized 0.9% in Q3 2024 , a slowdown from the previous quarter, as weak capital spending weighed on growth , though a surprising rise in consumption provided a bright spot. TOKYO (Nov 15): Japan’s economy grew at a slower pace in Q3 due to tepid capital expenditure and falling external demand , with net exports reducing GDP growth by 0.4 percentage points . However, private consumption surged by 0.9% , outperforming forecasts and offsetting some of the slowdown, government data showed. Key Highlights: GDP Growth: Annualized growth slowed to 0.9%, down from a revised 2.2% in Q2 but slightly above the 0.7% market estimate. On a quarterly basis, GDP rose 0.2%. Consumption: Private consumption, making up over half of Japan's GDP, jumped 0.9% , driven by a recovery in auto production and temporary income tax cuts. Capital Spending: Business investment fell 0.2%, matching expectations, as global economic weakness hit demand for machine...

Bank of Japan (BOJ) Governor Kazuo Ueda said on Wednesday that it is "still taking time" to sustainably reach the central bank's 2% inflation target , signaling a cautious approach to raising Japan’s near-zero interest rates . Speaking at a panel during the International Monetary Fund (IMF) meeting, Ueda acknowledged the potential risks of moving too slowly in adjusting rates, which could lead to a yen depreciation and higher import costs. However, he stressed that moving too fast could also result in speculative activity that could destabilize markets. "When there's huge uncertainty, you usually want to proceed cautiously and gradually," Ueda said. But he added, "If you proceed very, very gradually and create expectations that rates will stay low for too long, you could see a build-up of speculative positions ." The BOJ has already begun to move away from negative rates, raising short-term rates to 0.25% in July , citing Japan's progress to...

Bank of Japan (BOJ) Governor Kazuo Ueda reaffirmed that while the central bank is prepared to raise its key interest rate if data supports such a move, there will be no rush in doing so. In a speech delivered in Osaka on Tuesday, Ueda emphasized that the BOJ will take its time to carefully assess factors such as developments in financial and capital markets both domestically and internationally before making any further policy decisions. This signals little likelihood of a rate hike at the next BOJ meeting in October. Ueda’s remarks echo his previous statements following the BOJ’s unanimous decision last Friday to keep the interest rate on hold. Ueda acknowledged the criticism the BOJ faced regarding its communication prior to the July rate hike , emphasizing a more careful and transparent approach moving forward. Economists like Eiji Kitada of the Hamagin Research Institute noted that while Ueda signaled a future rate hike, it is not expected to happen soon. Ueda also suggested ...