Japan introduces negative interest rate to boost economy | AP News

Japan introduces negative interest rate to boost

economy
BY ELAINE KURTENBACHAP BUSINESS WRITER
Published 4:52 PM GMT+8, January 29, 2016
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TOKYO (AP) — The Bank of Japan on Friday said it will charge lenders that leave
too much cash on idle deposit with it, introducing a negative interest rate policy for
the first time as it seeks to shore up a stumbling economic recovery.

The surprise move rattled stock market investors, with the Nikkei 225 index swinging
between gains and losses after the announcement. It closed 2.8 percent higher. The
Japanese yen slid, with the U.S. dollar rising to about 120.70 yen from about 118.50
earlier in the day.

The central bank said it is imposing a 0.1 percent fee on some new commercial bank
deposits with the BOJ, effectively a negative interest rate. It hopes that will encourage
commercial banks to lend more, rather than keeping cash at the BOJ, and stimulate
investment and growth in the world’s third-largest economy.
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The BOJ said in statement that Japan’s economy is still recovering, but risks from
volatile global financial markets could undermine confidence and slow progress
toward the central bank’s 2 percent inflation target.

Bank deposits with the BOJ will be divided into three tiers. Existing current account
balances will earn a 0.1 percent positive interest rate. Required reserves held at the
central bank by financial institutions will earn zero interest. Any additional current
account deposits would incur the minus 0.1 percent rate, the BOJ said.

The bank “will cut the interest rate further into negative territory if judged as
necessary,” it said.

It said the policy would continue as long as needed to achieve its inflation target. In
the meantime, the BOJ pushed back its timeframe for achieving that goal from late
2016 to mid-2017.

“We think there is an increasing risk that an improvement in the business confidence
of Japanese firms and the conversion of deflationary mindset may be delayed, and that
the underlying trend in prices might be negatively affected,” BOJ Gov. Haruhiko
Kuroda said at a news conference.
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The European Central Bank has already imposed negative interest rates, after leaving
interest rates near zero failed to entice banks into seeking higher returns through
lending.

In Japan, keeping interest rates near zero has likewise failed to yield the desired
results, raising doubts about the credibility of the quantitative and qualitative
monetary easing policies announced by BOJ Gov. Haruhiko Kuroda in April, 2013.
Data on Friday showed Japan’s core inflation rate for 2015, excluding volatile food
prices, at 0.5 percent.

That and other figures show the economy remained anemic last year, as stagnant
incomes, the slowdown in China and the mixed blessing of lower oil prices hobbled
Prime Minister Shinzo Abe’s recovery strategy.

Consumer spending fell 4.4 percent in December from a year earlier, as households
chose to save rather than splurge on any gains from the low oil prices that are slowing
inflation. It was the fourth straight month of year-on-year declines.
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Industrial output fell 1.6 percent in December from a year earlier, partly due to slower
demand for machinery and electronics components and devices in China.

“Today’s activity data were disappointing and suggest that Japan’s economy barely
grew last quarter,” Marcel Thieliant of Capital Economics said in a commentary.

Abe took office three years ago vowing to get growth back on track through massive
injections of cash by the government and central bank, and by sweeping reforms to
boost competitiveness.

The central bank said Friday it would also persist with its “quantitative easing”
purchases of about 80 trillion yen (about $660 billion) of government bonds a year.

The aim is to end a long spell of deflation, or falling prices, that is thought to be
discouraging corporate investment. But while corporate profits have soared as
massive stimulus weakened the Japanese currency, making earnings made abroad
worth more when converted into yen, investment and wages have lagged.
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Average incomes fell 2.9 percent from a year earlier in December. Even though
unemployment was steady at 3.3 percent and the job market remained tight,
companies wary over the economic outlook are opting not to raise pay.

Some economists contend that the “Abenomics” focus on inflation as a spur to growth
is misplaced. Pushing the banks to lend will only work if companies borrow and
invest.

“Corporate Japan has accumulated substantial cash on balance sheets, while the Japan
labor market is getting tighter,” Ajay Kapur of Merrill Lynch said in a recent report.

“The key is to recirculate Japan’s corporate cash to Japan’s household-labor sector via
wage increases. Otherwise, ‘Abenomics’ is likely to fail in generating self-sustaining
growth,” he said.

https://www.channelnewsasia.com/asia/china-xi-jinping-tells-vietnam-roots-friendship-3860676

China's Xi Jinping commits to more

investments in Nigeria
Chinese President Xi Jinping speaks at the opening ceremony of the
Belt and Road Forum (BRF) to mark the 10th anniversary of the Belt
and Road Initiative at the Great Hall of the People in Beijing, on Oct
18, 2023. (Photo: REUTERS/Edgar…see more
ABUJA: China's President Xi Jinping pledged on Thursday (Oct 19) for his
country to increase investments in Nigeria's power generation sector and its
digital economy, the Nigerian vice president's office said in the wake of a Belt
And Road Initiative forum in Beijing.

Nigeria's National Agency for Science and Engineering Infrastructure

(NASENI) and three Chinese partners signed contracts for new projects valued
at US$2 billion, Vice President Kashim Shettima's office said.

It added that another US$4 billion worth of letters of intent was received for new
projects and investments in different sectors of the economy.

Nigeria is seeking to attract investments to boost sluggish growth in Africa's

biggest economy, which is saddled with mounting debt, high inflation and
unemployment.

The agreements signed include vehicle assembly projects, solar products, vehicle
design and production, drone technology transfer, clean energy utilisation and
the development of an industrial park.

Nigeria also signed contracts with China Harbour Engineering Company for the
construction of the Lekki Blue Seaport in Lagos.

Shettima met Xi, who asked for the protection of Chinese workers in Nigeria,
according to the vice president's office.

China had committed to rail projects in Nigeria in the past and to a seaport in
Bonny Island in the Niger Delta. But the projects are still waiting for loan
disbursements after securing approvals from China Exim Bank and Nigeria's
parliament.

At the Belt And Road Initiative Forum, China also committed to refinancing the
completion of two rail projects that stalled due to a cut in China's funding
commitments. China had earlier agreed to provide 85 per cent of the financing
for the rail projects.
https://www.channelnewsasia.com/business/india-restricts-import-laptop-computers-3674771

India restricts import of laptop, computers to

push local manufacturing

The Indian parliament building is reflected in a puddle after the rain as a man sweeps the water
in New Delhi, India on Jul 20, 2018. (File Photo: Reuters/Adnan Abidi)
03 Aug 2023 03:27PM(Updated: 03 Aug 2023 04:05PM)

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NEW DELHI: India has restricted imports of laptops, tablets and personal computers with immediate
effect, according to a government notice on Thursday (Aug 3), in a bid to push local manufacturing.

"Their import would be allowed against a valid licence for restricted imports," the notice said.

In April to June, electronics imports, which include laptops, tablets and personal computers, were
US$19.7 billion, up 6.25 per cent year-on-year. Electronics imports range between 7 per cent to 10 per
cent of the country's total merchandise imports.

"The move's spirit is to push manufacturing to India. It's not a nudge, it's a push," said Ali Akhtar Jafri,
former director general at electronics industry body MAIT.

India has been trying to push local manufacturing by giving production-linked incentives in over two
dozen sectors, including electronics.

It has extended the deadline for companies to apply for its US$2 billion manufacturing incentive
scheme to attract big-ticket investments in IT hardware manufacturing, which covers products like
laptops, tablets, personal computers and servers.

The incentive scheme is key to India's ambitions to become a powerhouse in the global electronics
supply chain, with the country targeting annual production worth US$300 billion by 2026.
Dell, Acer, Samsung, LG Electronics, Apple, Lenovo and HP Inc are some of the key companies
selling laptops in the Indian market and a substantial portion are imported from countries such as
China.

Shares of Indian electronic maker Dixon Technologies rose over 5 per cent on the news.

The intent seems to be "import substitution of certain goods that are imported heavily," said Madhavi
Arora, an economist at Emkay Global.

Laptops, tablets and personal computers compose about 1.5 per cent of the country's total annual
imports and nearly half of those are bought from China, according to government data.

India has imposed high tariffs in the past on products like mobile phones to catalyze domestic output.

Last year, it produced US$38 billion worth of mobile phones in the country, while local production of
laptops and tablets was just US$4 billion in comparison, according to estimates from the industry
body India Cellular and Electronics Association.
https://apnews.com/article/business-japan-global-trade-balance-35a9f9b08d66fb6887cb90255398baad

Japan racks up trade deficit as exports,

imports hit records

A container ship is loaded and unloaded at a container terminal at a port of

Kawasaki near Tokyo on March 9, 2022. Japan marked a trade deficit for the
15th month in a row in October, government data showed Thursday, Nov. 17,
2022, as both imports and exports reached record highs amid soaring costs of
energy and food, coming on top of the drooping value of the yen. (AP
Photo/Koji Sasahara)

BY YURI KAGEYAMA
Published 9:28 AM GMT+8, November 17, 2022
Share
TOKYO (AP) — Japan marked a trade deficit for the 15th month in a row in October,
as both imports and exports reached record highs amid the soaring costs of energy and
food and a drooping yen.

The deficit, at 2.16 trillion yen ($15 billion), was the highest for the month of October
since comparable data was first compiled in 1979, the Finance Ministry said
Thursday.

The huge deficit came despite a solid growth in exports, which rose 25.3% last month
to 9 trillion yen ($64 billion) from a year ago. Among the products boosting exports
were vehicles, medical products and electrical machinery, according to the ministry.
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Imports totaled 11 trillion yen ($79 billion), surging 53.5% from the previous year.
Japan is dependent on both energy and food imports at a time when inflation pressures
have been rising globally.

Japan’s trade balance has fluctuated in recent years partly because of disruptions to
production and other problems related to the coronavirus pandemic.

Also critical to the rising cost of imports is the declining value of the Japanese
currency. The U.S. dollar, trading at about 110 yen a year ago, has risen lately to
nearly 150 yen. The drop has eased in recent weeks, with the dollar now trading at
about 140 yen.

By nation, October exports grew to the U.S., as well as to Asia, particularly Indonesia,
Vietnam and South Korea. Imports grew from those nations as well, but also from
Taiwan, Malaysia and Germany. Imports from the Middle East soared 87%.
The war in Ukraine and other global factors have set off the recent steep rise in energy
costs. Japan imports almost all its oil.
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The weak yen tends to work as a boon for Japan’s giant exporters, like Toyota and
Nintendo, by raising the value of overseas earnings when converted in yen. But such
perks often aren’t enough to counter the rising costs of components, energy, raw
materials and other goods.

Lower interest rates tend to send that nation’s currency lower against those nations
with higher interest rates. The Bank of Japan has maintained a negative interest rate
policy, to keep economic activity going, while the U.S. Federal Reserve has
repeatedly tightened monetary policy to combat growing inflation pressures.

But the cheap yen is almost certain to be a plus for tourism, a key revenue for the
world’s third largest economy. After basically closing borders to tourists over worries
about COVID-19 infections, Japan has now switched to welcoming them.

___
https://www.cbsnews.com/live-
updates/israel-hamas-war-palestinians-
biden-speech-after-gaza-hospital-blast/
Israel-Hamas war: More airstrikes on
Gaza as aid remains stuck in Egypt;
Israeli troops told to "be ready" to
invade
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UP DAT ED ON: OCTOBER 19, 2023 / 11:00 PM / CBS NEWS
Our coverage of latest developments in the Israel-Hamas war continues here. Catch up on
earlier reporting below.

Israeli airstrikes on Gaza continued a day after President Biden visited Tel Aviv and gave the
country's leaders and people his firm support as the Jewish state grapples with the perilous
realities of its war against Hamas militants. Tension in the region was still rising Thursday over
Israel's relentless strikes on Gaza — and warring narratives over what happened at the Al Ahli
hospital in Gaza City on Tuesday night, where Palestinian officials say an explosion killed
hundreds of people.

U.S. and Israeli officials, including Mr. Biden, said Wednesday that evidence shows the
explosion was caused by a rocket fired by the Palestinian Islamic Jihad militant group that fell
short of its target, but many in the region still blame the carnage on the Israeli military.

Protests have erupted across the Middle East in the wake of the deadly blast, including in
Tunisia, Bahrain, Egypt, Lebanon, and Morocco. At demonstrations in the Israeli-occupied West
Bank, Palestinian officials said two teenagers were shot dead by Israeli forces. The Israeli
military said it was looking into the report.

Mr. Biden has backed Israel's right to quash Hamas, which has ruled the Gaza Strip for almost
two decades, but he has urged Israelis not to be consumed by rage, warning that wartime
decisions made without careful consideration would lead to mistakes.

Israel's defense minister, Yoav Gallant, visited ground troops amassed near the border with Gaza
and told them to "get organized, be ready" for an order to move in, although he did not say how
soon the expected invasion would start.
 I
sraeli Defense Minister Yoav Gallant meets with Israeli soldiers near the Gaza border on Oct. 19, 2023, in
this photo released by the Israeli Defense Ministry.I S R A E L I D E F E N S E M I N I S T R Y / A R I E L H E R M O N I /
H A N D O U T/A N A D O LU V I A G E T T Y I M A G E S

Speaking from the Oval Office on Thursday night, Mr. Biden said he would send on Friday, "an
urgent budget request to fund America's national security needs, to support our critical partners,
including Israel and Ukraine."

Mr. Biden also said, "We must without equivocation denounce antisemitism. We must also
without equivocation denounce Islamophobia."

Mr. Biden secured a commitment from Israel to stop bombing the area around Egypt's Rafah
border crossing with the Gaza Strip so desperately needed humanitarian aid can flow into the
enclave for the first time since Israel imposed a complete blockade on Oct. 7.

But it remained unclear on Thursday when the border would open, and instead of aid, it was still
Israeli missiles reaching Gaza's two million inhabitants. A residential building just yards from
the Al Quds hospital in Gaza City was struck Wednesday, sending medical staff and civilians
running for cover inside.

As of Thursday, health officials in Hamas-controlled Gaza say Israeli strikes have killed almost
3,800 people and wounded almost 12,500 others, a majority of them women and children. That
number includes more than 470 said to have been killed in the hospital blast, which Israel denies
causing.

In Israel, officials say Hamas' attack killed some 1,400 people and wounded 3,500 others.

The U.S. State Department said Thursday the death toll includes 32 Americans, and 11 U.S.
citizens remain unaccounted for. Efforts to secure the release of hostages held by Hamas remain
"ongoing," a State Department spokesperson said.

CBS News will air a one-hour special, "Israel-Hamas War: The World on Edge," on Friday,
Oct. 20 at 10 p.m. ET on CBS and on CBS News Streaming. Download the CBS News app on
your cellphone or connected TV to watch.

10:01 PM
DFA confirms 3rd Filipino fatality in Israel-Hamas war (cnnphilippines.com)

DFA confirms 3rd Filipino

fatality in Israel-Hamas
war
By Faith Yuen Wei Ragasa, CNN Philippines
Published Oct 13, 2023, 12:58:55 PM
Updated Oct 13, 2023, 5:54:04 PM

Metro Manila (CNN Philippines, October 13) — The Department of

Foreign Affairs (DFA) on Friday confirmed the death of a third Filipino
— a 49-year-old woman from Negros Occidental — as a result of the
ongoing war between Israel and Hamas.

“I regret to inform you that yes, it is confirmed. There is a third Filipino

casualty,” Foreign Affairs Undersecretary Eduardo de Vega said in a
Palace briefing.

“Now we join the nation in extending our deepest sympathies to the

relatives of the latest casualty who was also a caregiver,” he added.

She was Loreta “Lorie” Alacre, a caregiver. Her family has given
permission to name her.

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In a Facebook post on Oct. 8 written in Hebrew, Alacre's employer Noam
Solomon said the Filipino worker — who was her “devoted” caregiver
for the last six years — was last seen early Saturday morning between
the cities of Netivot and Ashkelon in the southern district of Israel.
Hamas launched its attack at the time.

She learned that Alacre was with a man later located in a hospital in
Ashkelon after he was shot in the back, but no report was given to the
Israeli employer on the whereabouts of the Filipino woman.

During the briefing, De Vega said the family is already aware of the
death and the Philippine Embassy in Israel is in talks with the woman's
siblings residing in Kuwait for the repatriation of her remains.

Alacre’s family said they received the tragic news from the embassy
through a phone call after waiting for six days for updates on whether
or not she was safe. They last spoke to the OFW on Oct. 6, a day
before Hamas attacked Israel.

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The family said she was supposed to return home in December for her
50th birthday celebration.

"Masakit po kasi pumunta po siya diyan para mag trabaho pero ganito
ang nangyari [It hurts because she went to Israel to work, but this
happened]," her sister Ana Alacre told CNN Philippines.

Ana said Lorie tirelessly helped their family in the last several years,
even supporting the education of her siblings' children.

With her gone, Lorie's nephew said some of his cousins may be forced
to stop schooling.

The embassy earlier announced two Filipinos were killed in the ongoing
war between Israel and the militant group Hamas.

The other two confirmed deaths were caregiver Paul Vincent Castelvi,
42, from Pampanga, and a 33-year-old female from Pangasinan working
in Israel for six years.