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Consumer spending dropped 0.4% in November from a year earlier, data from the internal affairs ministry showed, slightly better than the median market forecast for a 0.6% decline. On a seasonally adjusted, month-on-month basis, however, spending increased 0.4%, versus an expected 0.9% fall.Consumers cut back spending on food, clothing and entertainment, while expenditure in education and housing went up, the data showed. Consumption and wage trends are among key factors the Bank of Japan (BOJ) is watching to gauge the strength of Japan’s economy and decide how soon to raise interest rates. November’s pay data released on Thursday showed inflation-adjusted wages slid for the fourth straight month in November, dragged by higher prices even though base pay grew at the fastest pace in three decades. The BOJ ended massive monetary stimulus and raised interest rates to 0.25% last year. While some investors are betting the next rate hike will take place at a Jan. 23-24 meeting, others see a stronger chance in March. More
Peru has since September 2023 gradually eased the key lending rate from a high of 7.75% it held through the first part of that year.In a statement, the central bank said the cut moves the rate to a level it estimates to be “neutral” while adding future rate adjustments will track new data on inflation and its derivatives.The bank’s decision to lower borrowing costs came after December’s inflation rate inched up by 0.11% month-on-month, bringing price increases to 1.97% last year – within the bank’s target range of 2% plus or minus once percentage point.Prices were down from the 3.24% annual inflation rate recorded in 2023 and far below the 8.46% in 2022. December’s annualized rate was also down from 2.27% the previous month.Peru boasts one of Latin America’s lowest benchmark interest rates. More
The wildfires burning in the Pacific Palisades, Eaton (NYSE:ETN), Hurst and other Los Angeles neighbourhoods may lead to insured losses of more than $8 billion, analysts at Morningstar DBRS said in a note. This surpasses the 2018 Woolsey fire in California, which caused more than $6 billion in losses, Morningstar said.Jasper Cooper, senior credit officer for Moody’s (NYSE:MCO) Ratings, expected insured losses to amount to billions of dollars given the area’s high values of homes and businesses.Homeowners have found it tough to buy insurance in catastrophe-prone states as several firms have pulled out of the market.”These events will continue to have widespread, negative impacts for the state’s broader insurance market,” said Denise Rappmund, senior analyst at Moody’s. “Increased recovery costs will likely drive up premiums and may reduce property insurance availability.”Morningstar DBRS also said a larger than usual portion of the losses could be uninsured or covered under the California FAIR plan, designed to help homeowners where standard insurance is not available.JPMorgan on Thursday estimated insured losses at $20 billion, Thomson Reuters (NYSE:TRI) publication The Insurer reported, double its estimates of a day earlier due to an escalation of the damage. More
$99 for your first yearFT newspaper delivered Monday-Saturday, plus FT Digital Edition delivered to your device Monday-Saturday.What’s included Weekday Print EditionFT WeekendFT Digital EditionGlobal news & analysisExpert opinionSpecial featuresExclusive FT analysis More
(Reuters) – A look at the day ahead in Asian markets. Investors in Asia approach the end of a bumpy week hoping that the relative calm that descended on the dollar and a shortened U.S. bond market session on Thursday can extend into the local session on Friday.With the December U.S. employment report looming large and markets still feeling the whiplash from the surge in global long-term bond yields this week, trading in Asia may end up fairly range-bound and subdued.Nikkei futures are pointing to a flat open for Japanese stocks. The Nikkei is on track for a decline of around 0.7% on the week, underperforming the wider MSCI Asia ex-Japan index, which goes into Friday’s session flat on the week.Chinese stocks are also looking to end the week unchanged and unscathed. That can be interpreted two ways, however. It’s welcome news, given the doom and gloom that continues to surround the outlook for China in the eyes of many investors.On the other hand, Chinese stocks tumbled more than 5% the week before, their worst week in more than two years. In that light, failure to stage even a modest rebound the following week is a pretty ominous sign.It’s been a difficult start to the year for China bulls. Stocks are significantly lagging their regional and global peers, the bond yield collapse has been alarming, and uncertainty around a possible trade war with the U.S. is cutting deep.According to Goldman Sachs, financial conditions in China are the tightest since last April. Across emerging markets more broadly they are the tightest since November 2023. China’s latest inflation figures on Thursday weren’t particularly encouraging either. Consumer and producer prices for December were broadly in line with forecasts, cementing the view that deflationary pressures are not lifting any time soon.Economists at Barclays (LON:BARC) slashed their already weak 2025 CPI forecast to 0.4% from 0.8%, and they expect PPI inflation to remain in deflation throughout 2025. That would mark more than three years of falling factory gate prices. And it could get even worse if the incoming Trump administration in Washington follows through with its aggressive tariff threats.”We think a new trade war between China and the US would, on balance, have a deflationary effect, given downward pressure on exports would exacerbate the overcapacity issues in China,” they warned. The regional calendar is light on Friday, with the latest Japanese household spending figures most likely to move markets. Investors will be looking for early signs that recent wage agreements in Japan – the highest in decades – are beginning to lift consumer spending.The Bank of Japan said on Thursday that wage hikes are broadening across the country, suggesting that conditions for a near-term interest rate hike may be in place.Here are key developments that could provide more direction to markets on Friday:- Japan’s household consumption (November)- India industrial production (November)- Malaysia industrial production (November) More
Amanda Critchfield, a spokesperson for the Finance Committee’s new Republican chair, Senator Mike Crapo, said a hearing date has not been officially set, adding: “Senator Crapo is committed to moving Bessent’s nomination as quickly as possible.”Trump chose hedge fund investor Bessent as his Treasury secretary in November after a dramatic battle among prominent financiers for the coveted position that wields vast influence over U.S. economic, tax, regulatory and international affairs.Bessent faces a number of challenges, including rising bond yields that will make it more difficult to manage a $36 trillion federal debt load that is forecast to grow by nearly $8 trillion over a decade if Trump’s tax cut plans are implemented without offsetting savings.The founder of Key Square Capital Management also will need to maintain financial stability as Trump imposes steep tariffs on U.S. imports that threaten to disrupt supply chains and trade relations with allies and adversaries alike. But Bessent has argued that Trump’s agenda will unleash stronger economic growth and revenue, shoring up market confidence. More
SAO PAULO (Reuters) – Brazil’s President Luiz Inacio Lula da Silva may change officials in his cabinet before a meeting with ministers schedule to Jan. 21, Chief of Staff Rui Costa said on Thursday. In an interview with TV channel GloboNews, Costa said that the only change decided on so far was that of Lula’s spokesman, announced on Tuesday, but other swaps could come in the following weeks. More
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