Japan’s economy has been hurt by a variety of factors, not least decades of deflation or falling prices. Falling prices discourage people from spending and companies from investing, and that has trapped Japan in a cycle of sluggish growth and recession. Given the slowdown in Japan’s export sector in recent years, reviving domestic demand has become ever more crucial to spurring a fresh wave of economic growth in the country. Prime Minister Shinzo Abe has also said that stoking inflation is key to boosting domestic consumption. Under pressure from the government, the central bank had doubled its inflation target to 2%, earlier this year.
The YEN fell against the US$, and Tokyo’s Nikkei 225 index rose 2.2% on the central bank’s decision, indicating markets were reacting positively to the extent of the stimulus measures.
US equity markets are slowly rolling over, yesterday some significant technical damage was done. US equity markets started to roll over. Yesterday’s technical negative action increased significantly.
040413 CGI Morning Market Commentary-US Markets technical deterioration