Japan yesterday faced signs of mounting deflationary pressures and sluggish business investment as the world’s No. 2 economy reels from its worst recession since World War II.
Wholesale prices fell 3.8 percent last month from a year earlier, the steepest drop in nearly 22 years, the central bank said, raising concerns that Asia’s biggest economy is slipping into another bout of deflation.
Consumer prices turned negative in March for the first time in 18 months and the fear is that Japan may see a repeat of its 1990s deflationary spiral when falling prices led to weak consumer spending.
So far, however, the downward pressures are mostly due to falling energy and material costs, which is positive for ailing manufacturers, analysts said.
“Japanese companies have struggled to show profits due to high material costs and low product prices,” said Hiroshi Watanabe, an economist at the Daiwa Institute of Research. “The data show that the Japanese economy is starting to level off, which is a good sign.”
Another report showed Japan’s core machinery orders fell 1.3 percent in March from the previous month, much less than expected. The figures follow signs that exports and factory output may have bottomed out.
Finance and Economy Minister Kaoru Yosano said there were signs that the recession was abating but continued vigilance was needed.
“I welcome some signs of easing in the economic slowdown. But we need to remain alert about overall economic conditions,” he told reporters.
Japan’s economy entered recession in the second quarter of last year and suffered a brutal annual contraction of 12.1 percent in the last three months of the year. Analysts say the first quarter of this year was probably even worse. But recent data have suggested exports may be bottoming out, even if prospects for a full-fledged recovery appear dim.
PLA MANEUVERS: Although Beijing has yet to formally announce military drills, its coast guard vessels have been spotted near and around Taiwan since Friday The Taiwanese military is on high alert and is closely monitoring the Chinese People’s Liberation Army’s (PLA) air and naval deployments after Beijing yesterday reserved seven airspace areas east of its Zhejiang and Fujian provinces through Wednesday. Beijing’s action was perceived as a precursor to a potential third “Joint Sword” military exercise, which national security experts said the PLA could launch following President William Lai’s (賴清德) state visits to the nation’s three Pacific allies and stopovers in Hawaii and Guam last week. Unlike the Joint Sword military exercises in May and October, when Beijing provided detailed information about the affected areas, it
CHINA: The activities come amid speculation that Beijing might launch military exercises in response to Lai’s recent visit to Pacific allies The Ministry of National Defense (MND) yesterday said China had nearly doubled the number of its warships operating around the nation in the previous 24 hours, ahead of what security sources expect would be a new round of war games. China’s military activities come amid speculation Beijing might organize military drills around the nation in response to President William Lai’s (賴清德) recent visit to Pacific allies, including stops in Hawaii and Guam, a US territory. Lai returned from the week-long trip on Friday night. Beijing has held two rounds of war games around Taiwan this year, and sends ships and military planes
Five flights have been arranged to help nearly 2,000 Taiwanese tourists return home from Okinawa after being stranded due to cruise ship maintenance issues, the Ministry of Transportation and Communications announced yesterday. China Airlines Ltd (中華航空), and EVA Airways Corp (長榮航空) have arranged five flights with a total of 748 additional seats to transport 1,857 passengers from the MSC Bellissima back to Taiwan, the ministry said. The flights have been scheduled for yesterday and today by the Civil Aviation Administration, with the cruise operator covering all associated costs. The MSC Bellissima, carrying 4,341 passengers, departed from Keelung on Wednesday last week for Okinawa,
US president-elect Donald Trump said he would “never say” if Washington is committed to defending Taiwan from China, but “I would prefer that they do not do it [ an attack],” adding that he has a “good relationship” with Chinese President Xi Jinping (習近平). “I never say because I have to negotiate things, right?” Trump said in an interview with NBC’s Meet the Press host Kristen Welker after saying he would not reveal his incoming administration’s stance on Taiwan’s defense in the event of an attack. Asked the question again, Trump, in a reference to China, said: “I would prefer that they
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