Japan Macro Report

Research evidence excerpt

Japan Macro Report

Global Markets Research

22 June 2026Japan Macro Report

EQUITY: JAPAN STRATEGY

After Middle East and central bank events, focus Research Analysts

now on government response Japan Economics Kyohei Morita - NSC

Three major macroeconomic events have now passed: the provisional peace agreement kyohei.morita@nomura.com

between the US and Iran, the BOJ rate hike, and the new Fed chair's debut at the FOMC +81 3 6703 1395

meeting. The focus from here will likely turn to moves by the Japanese government, Japan FX Strategy

though with differing timeframes. Specifically, we expect attention on: (1) fiscal policy Yujiro Goto - NSC

under the Takaichi administration; (2) the possibility of further forex interventions; and (3) yujiro.goto@nomura.com

the government's growth strategies. In this report, we provide an update on the issues we +81 3 6703 1120

discussed in our Anchor Report: JapanMacroReport-Macroeconomicpolicyunder Macro strategy

Takaichiadministrationisnearingacriticalstage, reflecting recent macroeconomic Tomochika Kitaoka - NSC

conditions. tomochika.kitaoka@nomura.com

1. Japanese economy: Focus shifts to easing Middle East tensions and fiscal policy +81 3 6703 1815

management under Takaichi administration

The focus for the Japanese economy has shifted to: (1) the extent to which tensions in the

Middle East have eased; and (2) fiscal policy management under the Takaichi

administration. We think normalization of economic activity will require a restoration of the

Strait of Hormuz's functionality and stable crude oil prices, not just a peace accord

between the US and Iran. Moreover, in fiscal management during an inflationary period,

while a degree of discipline is required, fiscal policy can be expansionary and sustainable

at the same time.