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Japanese Prime Minister Sanae Takaichi has signalled a major shift in fiscal policy, saying her government will drop the annual target for achieving a primary budget surplus in favour of a multi-year framework.

Speaking in parliament on Friday, Takaichi said progress in restoring Japan’s finances will be judged “over a span of several years,” effectively diluting the country’s long-standing fiscal consolidation goal.

Her administration plans a new stimulus package to offset rising living costs and boost investment in growth sectors and defence. Analysts see the move as another sign of Tokyo prioritising growth over budget tightening, even as public debt remains more than twice the size of the economy — the highest among major economies.

The change marks a clear break from past administrations that used the annual primary balance target as proof of fiscal discipline. Takaichi, a known advocate of government spending, has criticised the metric as too restrictive and out of step with global norms.

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The shift away from Japan’s annual fiscal target signals a more expansionary policy stance under Takaichi, reinforcing expectations of continued fiscal stimulus. Markets will likely view the move as supportive for growth but negative for the yen and bond stability.

This article was written by Eamonn Sheridan at investinglive.com.

Reserve Bank of Australia Deputy Governor Andrew Hauser said the country’s monetary policy faces an “unusual challenge,” as the economy continues to run above its potential even after last year’s recovery began, leaving limited room for near-term rate cuts.

Speaking at a UBS conference in Sydney, Hauser said that demand was “slightly” above potential output when GDP growth resumed last year — the tightest recovery phase since the early 1980s. While this strength reflects resilient activity and strong employment, it also limits how far the RBA can loosen policy without reigniting inflationary pressures.

• That can still be consistent with bringing inflation back to target over the medium term
• But achieving that goal will require policy to be restrictive enough to keep shrinking the gap over that period

The deputy governor noted that Australia’s economic capacity remains tight, with little slack left in labour or supply conditions

• The absence of spare capacity is good news, it means busier companies and more jobs, but it does pose challenges for policy setting he added.

Hauser said rate cuts could resume from late 2025 to support growth but stressed that sustainable disinflation would require stronger productivity and investment in new capacity.

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The RBA last week kept its cash rate unchanged at 3.6%, pausing after three cuts earlier in 2025.

Policymakers have turned more cautious amid stronger inflation, firmer household demand, and a rebound in the housing market. The central bank now expects inflation to remain above its 2–3% target range until at least mid-2026, reflecting continued capacity constraints.

This article was written by Eamonn Sheridan at investinglive.com.

China has suspended its export restrictions on key strategic metals used in semiconductors and defense technologies, easing a year-long ban that had targeted shipments to the United States.

News from Sunday, in brief:

• China’s Ministry of Commerce announced Sunday that it would temporarily lift its ban on approving exports of “dual-use items” related to gallium, germanium, antimony, and super-hard materials. The suspension, effective immediately, will remain in place until November 27, 2026.

China had originally imposed the export controls in December 2024, citing national security concerns.

Beijing also said it is pausing stricter end-user and end-use checks on dual-use graphite exports to the U.S., which were introduced at the same time as the original ban.

The latest move follows a similar announcement on Friday, when China suspended additional export controls imposed in October on certain rare earth elements and lithium battery materials.

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These metals are vital for semiconductor manufacturing, military electronics, and renewable technologies.

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China’s suspension of critical metal export bans may ease global supply concerns for chipmakers and defense industries, signalling a possible easing in U.S.-China trade frictions.

Globex has opened for the week, emini equity indexes are up a bit on the positive news like this and this:

• Some media reports of reopening the US government

This article was written by Eamonn Sheridan at investinglive.com.

US Treasury Secretary Scott Bessent said on Monday that the US federal shutdown impact getting worse for the economy.

BOJ policy board member Junko Nakagawa speaks at 2240 US Eastern time / 0320 GMT

Junko Nakagawa voted with the majority at the October 30/31 Bank of Japan meeting to hold short term raters steady at 0.5%

• The two dissenters, Hajime Takata and Naoki Tamura, proposed raising the rate to 0.75%

Ahead of Nakagawa:

• Economic calendar in Asia Monday, November 10, 2025 – Bank of Japan Summary due

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Nakagawa was formerly chairperson of Japan’s Nomura Asset Management., is also considered a neutral.

This article was written by Eamonn Sheridan at investinglive.com.

The USD/JPY pair trades in positive territory near 153.70 during the early Asian session on Monday. The Japanese Yen (JPY) retreats from an over one-week high amid the uncertainty over the timing of the next interest rate hike by the Bank of Japan (BoJ).

ABC News reports that a sufficient number of Democrats are expected to back a short-term funding measure to end the U.S. government shutdown.

The proposal would extend federal funding until January 31 and fully finance the SNAP food assistance program and Veterans Affairs for the entire fiscal year, according to Senate sources.

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Stay tuned for further on this, just ‘reports’ at this stage, lets see what eventuates.

If true it should be a risk positive event.

Earlier on such moves is here:

• Sunday session for US Senate as lawmakers seek band aid funding for 10% of government

This article was written by Eamonn Sheridan at investinglive.com.

Speech by Deputy Governor Andrew Hauser

• Topic is On the Rails or Off to the Races? The Outlook for the Australian Economy
• venue is the UBS Australasia Conference, Sydney

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At its previous meeting the Bank expressed a less dovish view, slashing marekt forecasts for rate cuts any time soon. Inflation remains sticky high.

This article was written by Eamonn Sheridan at investinglive.com.

The recent optimism for a yen rebound is fading fast as major banks downgrade their forecasts and investors scale back expectations for an early Bank of Japan rate hike, with fiscal concerns under Prime Minister Sanae Takaichi adding fresh downward pressure on the currency.

Japanese media, the Nikkei, runs the report this morning, Tokyo time. In brief:

• JPMorgan Chase cut its year-end forecast for the yen to 156 per dollar from 142, and now sees 152 by March 2026 instead of 139.
• MUFG Bank and Sumitomo Mitsui Banking Corp. made similar downward revisions, signalling broad skepticism that the BOJ will tighten policy anytime soon.

At its most recent meeting, the BOJ left interest rates unchanged

• Governor Kazuo Ueda said the bank needed more time and data before deciding on rate hikes, prompting traders to interpret his stance as cautious.
• “It’s not a stage to proactively buy yen,” said Hirofumi Suzuki, chief FX strategist at SMBC, adding that there was “no groundwork” for an early move.
• Market pricing implies only a 57% chance of a rate hike in December.
• Analysts note that monetary policy expectations have become less influential than politics and fiscal signals.

Concerns are growing over Takaichi’s plans for “responsible and proactive” fiscal spending, with investors wary that a large supplementary budget could further weaken the yen.

MUFG’s Teppei Ino said the market will likely remain under selling pressure until the scale of the new stimulus is revealed. The government is expected to finalise its extra budget later this month.

Adding to the uncertainty, new members appointed to the Economic and Fiscal Policy Council come from Japan’s reflationist camp, reinforcing the view that Tokyo may tolerate a weaker currency.

JPMorgan’s Junya Tanase noted that “the selling reaction to Takaichi’s policies has been stronger than expected.”

While some strategists, including Citigroup’s Osamu Takashima, expect eventual yen buying as part of profit-taking in Japanese equities, most see limited support in the near term.

Markets are now watching an upcoming speech by BOJ policy board member Junko Nakagawa on November 10 for fresh clues on the central bank’s policy path.

This article was written by Eamonn Sheridan at investinglive.com.

You note the Chinese inflation data was published over the weekend, post is here ICYMI:

• China October inflation data: CPI 0.2% y/y (expected 0%), PPI -2.1% y/y (expected -2.2%)

The highlight of the event calendar today in Asia-Pacific is the Bank of Japan ‘Summary of Opinions’ from the October meeting.

From the day:

• Bank of Japan leaves rates unchanged, as expected
• JPY has dropped after the Bank of Japan expected ‘on hold’ decision, Nikkei up
• BOJ governor Ueda: Easy monetary conditions will continue to support the economy
• BOJ governor Ueda: No preset ideas about timing of next rate hike
• BOJ governor Ueda: We need more data in deciding to adjust degree of monetary easing
• BOJ governor Ueda: Want to see early momentum of spring wage negotiations

Don’t want to read that lot? Here is TD’s take on the decision and Ueda, seems a reasonable one:

• The BoJ’s hold and Ueda’s cautious remarks weakened the yen, but TD Securities said a December move remains on the table as wage data and fiscal coordination evolve.

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The Bank of Japan (BOJ) releases a “Summary of Opinions” after each monetary policy meeting. It serves as a record of the discussion and views of the Policy Board members on various economic and financial issues.

Key points about the Summary:

• The summary includes the views of the Policy Board members on economic conditions, both domestically and globally. This includes assessments of economic growth, inflation, and employment trends, among other indicators.
• The summary also outlines the Policy Board members’ views on the effectiveness of the BOJ’s current monetary policy measures, including interest rate policy, asset purchases, and yield curve control. Members may discuss the pros and cons of these policies and their potential impact on the economy.
• The summary includes discussions on the outlook for monetary policy and the potential risks to the economy. Board members may express their views on the appropriate timing and direction of future policy changes, as well as the potential impact of external factors such as global economic conditions.
• The summary also includes any dissenting views among the Policy Board members. If a member disagrees with the majority view on a particular issue, they may express their own opinion and rationale.

In a few week’s time we’ll get the Minutes of this meeting. The Minutes are a more detailed record of the discussions and decisions made during the meeting.

• The Minutes include a more complete record of the views expressed, including any dissents or alternative opinions that may not be included in the summary.
• The Summary of Opinions is typically released a few days after the policy meeting, while the Minutes are published about a month later. This means that the Summary of Opinions can provide more up-to-date information on the BOJ’s current stance and view on the economy and monetary policy.
• The Summary of Opinions is usually written in a more accessible language, making it easier to understand the BOJ’s views on monetary policy.
• The Minutes, on the other hand, are often more technical and may require a deeper understanding of economics and financial markets.
• The Summary of Opinions is typically shorter than the Minutes.

This article was written by Eamonn Sheridan at investinglive.com.