Covid-19 tips Japan into recession before Olympic Games


18 Mar

Covid-19 tips Japan into recession before Olympic Games

GDP drop in Q4 2019. Likely recession in the current quarter. Exceptional new economic support measures. Prospects are now positive for the Nikkei.

Key points

  • Japan’s GDP collapsed before the coronavirus crisis
  • Japan will almost certainly enter into recession in Q1 2020
  • More government economic support measures to come
  • Loss of relevance of leading indicators
  • Japan’s trade balance in record surplus in February
  • Households logically remaining cautious
  • BOJ strengthens asset purchase programme in the face of Covid-19 risk
  • Decline of yen to continue in 2020
  • Repositioning opportunity on the Nikkei