Japan’s government downgraded its assessment of the world’s third-biggest economy for the first time in 10 months as some analysts forecast that GDP will shrink this quarter.
Risks include a “further slowing down of overseas economies and sharp fluctuations in the financial and capital markets,” the Japanese Cabinet Office said in a monthly report released in Tokyo yesterday.
It cut an evaluation of the global economy.
The government cut its view on personal consumption, home-building, exports, imports and industrial production, while raising its assessment of the labor market.
The Bank of Japan (BOJ) next meets on Sept. 18 and 19 to review monetary policy, while global investors are awaiting a speech on Friday by US Federal Reserve Chairman Ben Bernanke to gauge the outlook for stimulus in the world’s biggest economy.
“Europe’s debt crisis is having the effect of a body blow to Japan’s economy,” said Yoshimasa Maruyama, chief economist at Itochu Corp in Tokyo.
“Concerns over Japan’s economic outlook will probably build pressure on the BOJ to apply more monetary stimulus,” said Maruyama, who added that the central bank could move in October.
JPMorgan Securities Japan Co forecasts a 0.3 percent annualized decline in GDP in the three months through next month, while BNP Paribas SA estimates a 0.9 percent fall. The median estimate in a Bloomberg News survey compiled this month was for 1 percent growth, partly supported by earthquake reconstruction work.
Japan stocks slid after the government downgraded its assessment of the economy.
The TOPIX lost 1.2 percent to 746.30 at the 3pm close in Tokyo, the biggest drop since Aug. 3, with more than five shares falling for each that rose.
The Nikkei 225 Stock Average slid 0.6 percent to 9,033.29 after rising as much as 0.6 percent earlier.
Grappling with the world’s biggest public debt burden, Japan’s government is also at risk of a financing crunch.
Japanese Finance Minister Jun Azumi said yesterday that government funds may “dry up” up if a financing bill fails to pass in the upper house of parliament.
“We’d have to consider how to save money while trying to avoid affecting people’s lives as much as possible,” he said.
“The Japanese economy is on the way to recovery at a moderate pace, partly due to reconstruction demand, while some weak movements are seen recently,” the Japanese Cabinet Office said.
The government lowered its economic evaluation of the US, Europe, China, the rest of Asia except India, and said Japan’s overseas shipments are “growing weaker.”
In the labor market, there are “signs of improvement, although some severe aspects still remain,” the Japanese government said.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last