The larger-than-expected plunge in April-June GDP and the disappointing initial economic indicators for July have shown that the underpinnings of Japan’s economic recovery are far weaker and more fragile than the Abe administration, and most economists, had presumed.
After spending month after month in the ¥102/$ range, the yen finally seemed to resume to depreciation on which the Abe team is counting so much. It’s a small breakout: just a couple percentage points to the ¥105/$ range, the cheapest the yen has been since last December
How much is it costing the Japanese people each year for Abe administration to protect the farm vote and the farmers’ lobby known as JA-Zenchu (JA being short for Japan Agriculture)? While we cannot pretend to give a precise estimate, we can give a sense of the some of the magnitudes involved, and they add up to several ties the entire output of the farm sectors.
This report continues to detail the costs to the Japanese economy of the continued protection of inefficient farm sectors, this time focusing on the Local Allocation Grants from the national budget that are given out to prefectural and local governments. These grants amount to upwards of 3.5% of GDP and quarter of the national budget.
Geopolitical tensions (Russia/Ukraine) are weighing on Europe As a result the dollar has appreciated some vs the Euro.