Japanese firms boost capital spending, defying forecasts and hinting at potential interest rate hikes.

Japanese firms showed unexpected resilience in corporate confidence by increasing capital expenditure in the July to September period, with a 0.8% rise in investments on goods, mostly from manufacturers. This contrasts with a 0.2% drop in corporate spending, as reported in the GDP initial reading. The yearly capital expenditure rose by 9.5% (excluding software) and 8.1% (including software), exceeding forecasts. This trend suggests the Bank of Japan might raise interest rates sooner, potentially as early as December.

December 02, 2024
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