Japan Economy On Track According to Reuters Poll

Japan’s economy will remain on track as the government prepares a 5 trillion yen ($50.6 billion) stimulus package to offset the drag from a sales tax increase scheduled for next April, a Reuters poll showed.

Economists expect the majority of the stimulus package to be spent on infrastructure and tax breaks for the corporate sector, the poll conducted October 10-15 showed.

It also concluded that Prime Minister Shinzo Abe’s government should take additional steps to ease regulations and encourage new markets for goods and services to lift the country’s potential growth rate.

“Although details of some spending measures will be determined in December, we estimate these fiscal measures will largely offset the negative impact from the consumption tax hike,” Nomura Securities economists said in a note to clients.

“We expect the policy focus to shift to the growth strategy, which the government will start to enact in the next Diet (parliamentary) session that convened on 15 October.”

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza