Impact of a stronger yen on Japanese exports

- Impact of a stronger yen on Japanese exports
• "Our statistical analysis found that the nominal USD/Yen exchange rate little matters for growth of real exports"
• "As the real effective yen exchange rate, a more relevant variable for real exports, has been relatively stable, we don’t think it necessary to alter the outlook for net exports going forward unless the forecast for global industrial production is revised meaningfully"
- Growth forecast revised technically after the release of Q2 GDP
• "While Q2 (Apr-Jun) 2010 GDP growth rose 0.4% qoq annualized for the fifth straight quarter of positive growth, this represented its lowest point in three quarters"
• "Upon the release of Q2 GDP data, we revised our annual growth forecasts; in the revised forecasts, we look for 2.6% and 0.8% for real GDP growth for CY2010 and CY2011, respectively (prior to the revision, 2.9% and 1.0%, respectively)"
• "Weaker than expected Q2 GDP results and the recent deterioration of leading indicators for production and consumption have been responsible for the downward revisions"
• "The momentum of the recovery in consumer sentiment is slowing down. The July Business Watcher Survey showed that outlook DI for household-related activity dropped for the third consecutive month. The Consumer Confidence Index also fell month-on-month in July for the first time in seven months."
- Demand for bank loans remains weak
• "Money stock in July indicates weak demand for funds and less risk appetite among investors"

CreditSuisse Japan Economics Weekly 20100819

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