The Tokyo market always takes a fall in the Nasdaq to heart.
By pushing through the policy change, the Bank of Japan risks being blamed by the government if something happens to the economy and things deteriorate.
Business spending is evidently strong and will remain so for the rest of the year, driving overall economic growth.
Expectations for higher interest rates are solid now. No one doubts that the Japanese economy is improving.
The Bank of Japan already has a free hand to decide when to raise interest rates. The bank will probably take action in the third quarter.
The pace of consumer spending in the first half was too strong, so it will be slower in the second. The gradual increase in wages and decrease in unemployment will continue.
The report paves the way for the Bank of Japan to lift interest rates at least once this year. The Japanese economy gives no reasons to restrict the bank's successive rate increases after the first one.
We had once thought Mr. Koizumi's government could meet our expectations, but it now seems we may have overestimated their ability.
Wage and labor conditions have been a lot stronger than expected. We expect the bank to end its zero-rate policy in the third quarter.
There's no doubt that the economy is emerging from deflation, and is at little risk of slipping back into it.
