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MNI INSIGHT: Data Reinforces BOJ's Stance Despite Factory Gain

(MNI) Tokyo
TOKYO (MNI)

A further economic slowdown in the U.S. as the Fed hikes aggressively will likely dim export prospects.

Forecasts for higher factory output in July-September are not enough for a robust economic recovery in the near term to allow the Bank of Japan to consider any changes to easy policy as a surge in Covid-19 cases and an expected global economic slowdown amid Fed rate hikes weighs, MNI understands.

Japan's industrial output rose 8.9% m/m in June, data showed on Friday, and is expected to rebound 6.1% on quarter in the July-September period. But other data on retails sales, down 1.4% in June from May, higher Tokyo consumer prices and falling sentiment painted a more downbeat picture. However, job figures remain strong at 2.6% unemployment.

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Forecasts for higher factory output in July-September are not enough for a robust economic recovery in the near term to allow the Bank of Japan to consider any changes to easy policy as a surge in Covid-19 cases and an expected global economic slowdown amid Fed rate hikes weighs, MNI understands.

Japan's industrial output rose 8.9% m/m in June, data showed on Friday, and is expected to rebound 6.1% on quarter in the July-September period. But other data on retails sales, down 1.4% in June from May, higher Tokyo consumer prices and falling sentiment painted a more downbeat picture. However, job figures remain strong at 2.6% unemployment.

Keep reading...Show less