Economist: Bank of Japan rate hike, US economic data below expectations and other factors will shake the market
2024-08-10
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This article is transferred from [CCTV News Client];
At the beginning of this week, the Japanese securities market and foreign exchange market experienced strong fluctuations due to the Bank of Japan's policy rate hike and the US economic data that was lower than expected. Earlier, Bank of Japan Governor Kazuo Ueda said that the policy rate hike would not have a significant negative impact on the economy. HoweverJapanese economists pointed out that there are still shocks and fluctuations in the market. In the future, the Bank of Japan may continue to raise interest rates.。
Hideo Kumano, chief economist at the Economic Research Department of Dai-ichi Life Research Institute:Although the interest rate increase by the Bank of Japan was small, it triggered a huge chain reaction of yen appreciation and stock market decline. Therefore, I think the interest rate increase by the Bank of Japan has actually caused a major impact on the market. However, I don’t think the Bank of Japan will stop the process of interest rate normalization. The Bank of Japan has announced at a press conference on July 31 that if the price increase rate is stable above 2% as expected, they will continue to raise interest rates according to their plan, although the specific time has not been announced.
Hideo Kumano also pointed out that the Japanese stock market is highly correlated with the US stock market. The current fluctuations in the Japanese securities market and foreign exchange market also reflect the outside world's concerns about the US economy.
Hideo Kumano, chief economist at the Economic Research Department of Dai-ichi Life Research Institute:Currently, the Japanese stock market is one of the most volatile stock markets in the world, especially with the high linkage with the US stock market. One of the reasons for the large fluctuations is believed to be the impact of exchange rates. When stock prices fall, the appreciation of the yen will also occur simultaneously. The decline in stock prices and the appreciation of the yen will cause the performance of Japanese export companies to deteriorate, thereby further depressing stock prices. Now the exchange rate between Japan and the United States is still looking for a stable point, and there are still concerns about the US economy behind the exchange rate fluctuations. If the US economy weakens after this fall, it will also have a negative impact on the Japanese economy.
