Key View: We highlight that Japan’s power market risks a supply and demand mismatch, with hotter weather threatening to increase power consumption amid power generation bottlenecks. Stronger reliance on conventional thermal power generation, compared to other power types, is leaving Japan vulnerable to power shortages in the face of high gas

Key View

• Japan’s power market risks a supply and demand mismatch, with hotter weather threatening to increase power consumption amid power generation bottlenecks.
• Stronger reliance on conventional thermal power generation, compared to other power types, is leaving Japan vulnerable to power shortages in the face of high gas prices and stunted

Key View

• Prime Minister Fumio Kishida’s LDP-Komeito coalition government has been boosted by Upper House elections, boding well for continuity of Japan’s loose monetary and fiscal policies, and robust defence policy.
• However, Kishida faces modest downside risks from the adverse global economic climate, as well as potential instability within

Key View

• Surging global energy prices continue to pose headaches for oil and gas import-dependent Japan, driving up the import bill and adding to already elevated inflation fears.
• The current soaring oil and gas prices are reviving calls for nuclear restarts in Japan as a means to bring down rising power costs while also reducing overall

Key View

Key View

• We at Fitch Solutions retain our view that the Bank of Japan (BoJ) will maintain a dovish bias amid rising headwinds to growth and despite rising inflation.
• We forecast that the BoJ will keep its policy rate at its current record low of -0.10% through to 2023 before raising it to 0.00% in 2024.
• Risks to our rate outlook are balanced

Key View

• We at Fitch Solutions have revised down our 2022 growth forecast for on the back of a weak Q122 growth print, soaring energy prices and a still high number of new Covid-19 infections delaying a full reopening of the economy.
• We now expect that Japan’s real GDP will increase by 2.0% in 2022. This is still above trend but lower than

Key View

• Japan’s dependence on natural gas imports for the majority of its electricity supply will place pressure on the government to pivot to other power types, in light of the challenges in the gas sector.
• In order to wane off dependence on gas power generation, Japan has acknowledged the need to speed up restarting of nuclear power plants

Key View

• The risk of inflation and the ongoing surge in Covid-19 cases in Japan will keep the pressure on consumers and restrict demand for new vehicles in 2022.
• Furthermore, adding to the headwinds is the weak local vehicle production due to the global semiconductor (chip) shortage which will keep the supply of new vehicles tight and the