Japan Real Time Charts and Data

Edward Hugh is only able to update this blog from time to time, but he does run a lively Twitter account with plenty of Japan related comment. He also maintains a collection of constantly updated Japan data charts with short updates on a Storify dedicated page Is Japan Once More Back in Deflation?

Friday, February 17, 2006

Could This Be The Reason?

As noted in the last post, there has been a noteable movement of foreign investors out of Japan in the last week. Today we have news of a draconian report from the Japanese government Council on Economic and Fiscal Policy which indicates the country either needs major spending cuts or a sharp rise in taxes. When you couple this with the possibility of a steady rise in interest rates and the fact that wages are ticking up above productivity due to the kind of labour shortage an ageing economy will naturally produce, then you have to wonder whether some people haven't look at this report, put two and two together, and decided it's time to up-tent.

Japan’s government would need to cut more than the equivalent of its defence, education and public works budgets combined in order to balance its books by 2011, Junichiro Koizumi’s main policymaking body was told on Wednesday night.

The effort to prove the necessity of a tax rise to close the budget deficit – about 4 per cent of gross domestic product before interest payments – comes as the cabinet’s so-called fiscal hawks are losing ground.