A series of economic indicators published last week for Japan confirm that the ‘magic’ of Abenomics has faded to nought. Official estimates published this week by the Cabinet Office suggest that, relative to potential, output fell significantly through last year. By 2014 Q4, Japan’s output gap was -2.2%.
Read about it on Reuters’ Alpha Now
- According to the official data released last week, Chinese growth hit a 24-year low of 7.4% in 2014.
- Our own China Momentum Indicator (CMI) stood at just 3.9% in December. It points to much weaker growth, and a more dramatic slowdown, than the official data.
- The CMI supports signals coming from commodities markets that China is slowing rapidly. In our view China is now in a hard landing.