18.11.2014 - Shinzo Abe rescheduled raising of the sales tax
The Prime Minister of Japan Shinzo Abe today announced the postponement of raising the sales tax to 18 months. We recall that in April, the sales tax was increased by 3% to 8%, and in October 2015 was supposed to take place an increase from 8% to 10%. In addition, Mr. Abe said that the lower house of parliament will be dissolved on November 21. We recall that policy aimed at achieving the inflation rate of 2.0% resulted in the creation of about 1 million jobs, but has led to a decline of GDP in the 3rd quarter of this year. Given the current situation in the Japanese economy, we expect the continuation of stimulation with growth of liquidity, resulting in a further decline of the yen. We maintain our medium-term negative outlook on the Japanese yen, but expect further growth of the stock market of the country.