How exposed are Japanese banks to Antipodean asset values?
Japanese bank shares often appear attractive in valuation terms, such as price-to-book, but currently there is the added possibility that the Bank of Japan will relax its yield curve control (YCC) policy this year, leading to a surge in the 10-year JGB yield and in bank profitability. However, there has been an interesting co-movement of Japanese and Australian bank return indexes in recent years, suggesting a closer connection between their fortunes than is commonly imagined. Over the past 18 months, Japanese bank performance has been more closely aligned to that of Australian banks than to the slope of the Japanese yield curve. While the fate of the Australian and New Zealand residential property markets might be considered a remote concern for Japanese banks, hidden dangers may be lurking in the shadows.
Economic Perspectives is a trusted provider of global macroeconomic and financial research with clients in North America, Asia and the UK.
EP research weaves complex and diverse information into coherent macro narratives, providing clear analysis and original market insights for global investors. Our clients benefit from our long experience in connecting economic developments with the credit and financial market outlook.
The analysis of developments in global private sector credit markets is fundamental to our understanding of the global economic and financial outlook. However, the actions and interventions of central banks and government have become increasingly important to our economic assessment.
For several years we have maintained that the only credible resolution of the 2008 global credit crisis is a resurgence of global inflation. We take an eclectic approach to the inflation outlook, considering political and socio-economic factors alongside macroeconomic drivers. We provide the multi-dimensional appraisal of the inflation outlook that is critical to formulating a successful investment strategy, at a time when inflation complacency is rife.
We offer our research on a subscription basis or as a bespoke consultancy service. Our publications reflect our research agenda, shaped by the issues raised in client meetings. Our bespoke work tackles research projects of particular interest to our clients and is delivered as written reports or presentations.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.