Japanese Yen: Nominal growth underpins cautious strength – Commerzbank
Commerzbank’s Volkmar Baur says solid nominal growth and higher-than-expected inflation should keep pressure on the Bank of Japan (BoJ) to raise rates again as early as September or October.
Commerzbank's Volkmar Baur suggests that solid nominal growth and higher-than-expected inflation could prompt the Bank of Japan to raise interest rates as early as September or October. Despite a slower-than-expected real growth rate in the second quarter, the nominal growth of 1.2% remains positive for the Japanese economy. This, combined with the higher inflation, should keep pressure on the BoJ to raise rates, potentially supporting the Japanese Yen.
While the yen has shown little reaction to this news, it is supported by the robust growth and expectations of higher tax revenues due to improved fiscal conditions.
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