Japan: News stream has been positive - BBH

Analysts at BBH note the news stream from Japan has been positive as the annualized growth surpassed expectations in January-March period.  

Key Quotes

“This week's report should show a modest acceleration in inflation (to 0.4% year-over-year) after declining in February and March).  The core rate, which in Japan, excludes fresh food, may also rise to 0.4%, which would be the fastest clip in two years.”

“Japan April trade figures were released.  As expected, the trade surplus was smaller than a year ago, and this saw the 12-month rolling average slip for the second consecutive month.  Imports quickened modestly while exports slowed.  Looking ahead, we note that the May trade balance is almost always (19 of the past 20 years) worse than the April balance.”

“Another sign that Japan's economic outlook has brightened is that Abe is willing to spend more effort and political capital on his political agenda of changing the constitution to give his country a stronger defense.  Abe has been successful in staying off the US radar screen, though his defense efforts are consistent with what the US President has advocated.”