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Japan

Tokyo Headline CPI Inflation Dips Below 3%
Tokyo’s headline CPI inflation fell below expectations in August, easing from 3.2% y/y to 2.9% y/y – slightly below anticipations of 3.0% y/y and the first dip below 3% in nearly one year. Similarly, the slowdown in the ex-fresh food measure from 3.0% y/y to…
Daily Insights
Evaluating The Pros & Cons Of Inflation-Linked Bonds

In this report, we assess the best opportunities in inflation-linked bonds in the major developed economies, based on trends in growth, inflation and the stance of monetary policies in each country. We conclude that the environment is turning more challenging for European inflation-linked bond performance versus nominal government bonds, while the opposite is true in Japan. In the US, US TIPS breakevens have likely peaked, particularly at the short end.

Global Fixed Income Strategy
Sell EUR/JPY
Earlier this week, EUR/JPY closed at a fresh 15-year high, bringing its year-to-date gain to 14%, before losing some ground over the subsequent two days. To the extent that the recent increase in global bond yields continues to encourage carry trades, it has…
Daily Insights
August PMI Data Supports European Bond Outperformance Vs. USTs & JGBs
The flash August S&P Global PMI data released on Wednesday painted a picture of softer global growth, while also hinting that Europe is on the cusp of recession. The composite PMI for the euro area fell by 1.6 versus the previous month to 47.0, led by…
Daily Insights
The Inflation Genie In Japan
According to BCA Research’s Foreign Exchange Strategy and Global Investment Strategy services, most indications of Japanese inflation are pointing to upside surprises. This will boost interest-rate differentials in favor of the yen. Core-core CPI came…
Daily Insights
The Case For Japan

In this special report, we discuss whether the economic conditions necessary for a stronger yen (and higher JGB yields) will materialize over the next 12-to-18 months.

Foreign Exchange Strategy, Global Fixed Income Strategy, Global Investment Strategy by Melanie Kermadjian, Chester Ntonifor
The Case For Japan

In this special report, we discuss whether the economic conditions necessary for a stronger yen (and higher JGB yields) will materialize over the next 12-to-18 months.

Foreign Exchange Strategy by Melanie Kermadjian, Chester Ntonifor
Japanese GDP Reaches Escape Velocity
Japanese real GDP grew at an annualized pace of 6% year-on-year in Q2. Reading the tea leaves from the release, public investment rose by 5% quarter-on-quarter annualized, while residential investment jumped by a whopping 7.7%. The big takeaway, however, was…
Daily Insights
BoJ Commits To "Greater Flexibility"
On Friday, the Bank of Japan announced an important tweak to its yield curve control (YCC) program. Although it maintained the 0.5% cap on 10-year bond yields, it indicated that it will manage the program with “greater flexibility” such that the 0.5% level is…
Daily Insights
Month-In-Review: The Dollar, The Economy, And Central Banks

The DXY will continue to have near-term upside, as economic growth holds up in the US, while it deteriorates in other parts of the world. Remain constructive on the DXY at current levels, but pivot to a short position on evidence US growth is boosting the rest of the world.

Foreign Exchange Strategy by Chester Ntonifor

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