A Framework That Provides Clarity

During periods of “low visibility,” confusion reigns: for every indication of one trend, there seems to be a countertrend. The key is to glean from the collective wisdom of reliable leading indicators a clear signal that the economy is headed for a turn.

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Aug 22 2014

Japanese Inflation Trajectory in Question

In June, two months after the sales tax hike, Japanese consumer price inflation began to slip. So far, this is in line with the scenario presented by the Bank of Japan (BoJ), which expected inflation to ease before firming later as a tight labor market pushed up wages. But how likely is that to happen?

ECRI’s Japanese Future Inflation Gauge, designed to anticipate cyclical swings in Japanese inflation, already shows unambiguously where Japanese inflation is headed in the coming months, and therefore, how likely the BoJ’s expectations are to materialize.

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A House of Cards

ECRI August 18, 2014

With home price growth in a clear downturn, any wealth effect from home prices has faded. More