Japan Economist, Japan Macro Advisors

Takuji Okubo

Japan Economist

Concise and Insightful Analysis on Japan Economy

Japan Macro Advisors

Our mission is to provide a concise and timely analysis on the Japanese economy for the benefit of global audiences. Communication, especially in foreign languages, has always been a weakness for the Japanese, which was fine when Japan's economic might attracted foreign media and various other institutions to study and report on Japan - such days are long gone. In the last two decades, we saw foreign institutions reallocating their resources from Japan to other more exciting parts of the world. As a result, when we read reporting on Japan in foreign media, we sense a subtle but noticeable decline in the depth of understanding what is actually happening in Japan.

Macroeconomics

<ul>
<li>The BoJ raised its policy rate to 1.0%. Its forward communication signaled that more than one hikes are in store, pointing to at least 1.5% terminal rate or higher.</li>
<li>The majority bloc is turning hawkish even as a likely dove is scheduled to join the board in July. Koeda and Masu are critical swing votes to watch.</li>
<li>JGB purchase will stay level at 2 trillion yen/month from April 2027. Private sector needs to absorb ¥40trn, 6% of GDP, in each the next 4 years.  </li>
</ul>


The BoJ raised its policy rate to 1.0%. Its forward communication signaled that more than one hikes are in store, pointing to at least 1.5% terminal rate or higher.
The majority bloc is turning hawkish even as a likely dove is scheduled to join the board in July. Koeda and Masu are critical swing votes to watch.
JGB purchase will stay level at 2 trillion yen/month from April 2027. Private sector needs to absorb ¥40trn, 6% of GDP, in each the next 4 years.  


BoJ Signals Terminal Rate Is 1.5% or Higher

<ul>
<li>We introduce our BoJ PSI, an index tracking each member's stance on Economy, Inflation and Policy Rate. We attribute anonymous remarks in meeting minutes to individual members to produce PSI. </li>
<li>A proof of concept is Nakagawa Junko's April rate hike dissent, which surprised the market. Our PSI record shows her inflation assessment rising from November 2025 through March 2026.</li>
<li>With a June hike well priced in, the question is the timing of the next hike. Our PSI should provide a transparent way to monitor swing votes, Koeda and Masu. </li>
</ul>


We introduce our BoJ PSI, an index tracking each member's stance on Economy, Inflation and Policy Rate. We attribute anonymous remarks in meeting minutes to individual members to produce PSI. 
A proof of concept is Nakagawa Junko's April rate hike dissent, which surprised the market. Our PSI record shows her inflation assessment rising from November 2025 through March 2026.
With a June hike well priced in, the question is the timing of the next hike. Our PSI should provide a transparent way to monitor swing votes, Koeda and Masu. 


Behind the Votes — Introducing the BoJ Policy Stance Indicator

Asia L/S Equity PM/Macro/Thematic Idea Generation

Rikki Malik

Thematic (Sector/Industry)

<ul>
<li>Revisiting a sector we have liked for the last 2 years</li>
<li>We discuss current sector dynamics and why they could be  a potential short</li>
<li>Recent positive earning surprises from the banks have not moved the stocks</li>
</ul>


Revisiting a sector we have liked for the last 2 years
We discuss current sector dynamics and why they could be  a potential short
Recent positive earning surprises from the banks have not moved the stocks


Japanese Megabanks – Time to Get Short?

Cross Asset Strategy

<ul>
<li>A review of recent events/data impacting our investment themes or outlook</li>
<li>Revisiting some of our old favourites- China, Japan and Gold</li>
<li>Short-Term trades continue to work but investors only interested in US equities</li>
</ul>


A review of recent events/data impacting our investment themes or outlook
Revisiting some of our old favourites- China, Japan and Gold
Short-Term trades continue to work but investors only interested in US equities


Overview #13 - The US Dollar Peaks, Japan Struggles While China Treads Water

<ul>
<li>Earnings surpassed consensus expectations providing no pullback to allow entry</li>
<li>Most operating metrics improved and all trends are goign in the right direction</li>
<li>Capital management is top of mind for management with a common thread of increasing ROEs and PBRs</li>
</ul>


Earnings surpassed consensus expectations providing no pullback to allow entry
Most operating metrics improved and all trends are goign in the right direction
Capital management is top of mind for management with a common thread of increasing ROEs and PBRs


Japanese Megabanks' Earnings Exceed Expectations - Stay on the Train?

Japan

TOPIX-Banks Index is a capitalization-weighted index of all the banks listed on the First Section of the Tokyo Stock Exchange and is one of the 33 industry sectors of the TOPIX Index (TPX). The index was developed with a base value of 1000 as of January 6, 1992. The parent index is TPX.

TOPIX Banks Index (TPNBNK INDEX)

BoJ Signals Terminal Rate Is 1.5% or Higher

BoJ signaled the the terminal rate is at least 1.5% or higher. It QT decision is no concession to a fiscally expansive government. 6% to GDP worth...

Takuji Okubo

Behind the Votes — Introducing the BoJ Policy Stance Indicator

Introducing new BoJ policy stance indicator. We attribute anonymous remarks to board members to produce their scores. PSI was able to track...

Takuji Okubo

Japanese Megabanks – Time to Get Short?

From a short-term trading perspective, we would look to cover half our shorts in the sector today as the stocks approach the 200-day Moving...

Rikki Malik

Overview #13 - The US Dollar Peaks, Japan Struggles While China Treads Water

A review of recent events/data impacting our investment themes and outlook. We look at the some recent trends in China, Japan and the USD

Rikki Malik

Japanese Megabanks' Earnings Exceed Expectations - Stay on the Train?

Banks' strong earnings performance and focus on capital management drives positive stock price performance. Will it continue?

Rikki Malik