More than 10 million people received a single dose
June 3, 2021 (Thursday) Cloudy with occasional clear spells Mercury retrograde (May 30 – June 23)
・As coronavirus vaccinations progress and advanced economies see more active economic activity, logistics bottlenecks are intensifying.
In May, a U.S. manufacturing orders delay index reached the highest level since the 1970s, signaling a surge in input delays.
If the supply cannot keep up with the sudden surge in demand, inflationary pressures could rise excessively and hinder the world economy’s recovery from the pandemic.
・The U.S. Institute for Supply Management (ISM) manufacturing PMI on the 1st showed a May orders-delivery index at 78.8, up 3.8 points from a year earlier, the highest since the first oil crisis in 1974.
Logistics bottlenecks are spreading globally. Container ships waiting off Qingdao, China, are at their highest since 2019.
By April, only about 40% of global freight ships could reach ports on schedule, with delays averaging over five days.
・Toyota <7203> [Close 9,628 yen] urged major global suppliers to reduce CO2 emissions by 3% from the previous year for 2021.
Leading the decarbonization of the entire supply chain.
Honda <7267> [Close 3,518.0 yen] also informed that by this autumn it will urge major component suppliers to set emission-reduction targets.
・In Japan, the number of people who have received at least one dose of the coronavirus vaccine surpassed 10 million as of the 1st.
Among frontline healthcare workers, 97% of those targeted have completed the first dose, and roughly 15% of those aged 65 and over have been vaccinated.
Vaccination pace has averaged about 560,000 doses per day, with a push to reach 1 million doses per day.
The government expects to secure vaccines for the elderly by the end of June,
while maintaining the priority for seniors and starting vaccination for the general public aged 12–64 at workplaces and universities from the 21st.
・Apple’s device production sees increasing involvement of Chinese firms.
In its supplier list released by Apple by the 2nd, Chinese (including Hong Kong) firms accounted for 51 of 200, up from 42 of 18 years ago, overtaking Taiwan for the first time and ranking first.
Taiwan 48 firms (47 previously), Japan 34 firms (38 previously), Vietnam 21 firms (14 previously). U.S. 32 firms (38 previously).
・COVID-19 vaccination continues to accelerate.
The government announced on the 2nd that 98.7% of municipalities expect to complete elderly vaccination by the end of July, based on surveys.
The development of large-scale vaccination sites is advancing, and an early vaccination framework is taking shape.
・Taiwan Semiconductor Manufacturing Co. (TSMC) on the 2nd revealed plans to complete an ultra-advanced semiconductor test line in Taiwan within the year.
A construction plan for a high-volume production factory was also announced.
The circuit line width will be 2 nanometers, several generations ahead of the current leading-edge products.
This will further widen the gap with rival Samsung Electronics of Korea, strengthening its monopoly.
・G7 Summit to be held 11–13 in the United Kingdom; a meeting to discuss China is to be arranged.
Issues related to China, including security, human rights, and economy, will be discussed.
It is unusual to discuss a broad range of concerns about a specific country outside imminent crises or conflicts.
The aim is for the U.S., Japan, and Europe to stand united in addressing China.
・The government on the 2nd announced an outline of its growth strategy to be decided within the month.
The plan signals mobilizing all policies to attract the semiconductor industry domestically.
Semiconductors have become a global race for attracting investment.
To spur demand, the government will also foster industries that use advanced semiconductors.
Plans to accelerate digital investment in fields such as 5G, autonomous driving, smart cities, and medical robotics.
The outline also indicates concentrated investment to domestically produce and expand facilities for batteries and next-generation data centers, in addition to semiconductors.
・The Ministry of Internal Affairs and Communications on the 2nd criticized SoftBank Group <9434> [Close 1,403.5 yen] for delays in installing 5G base stations and issued administrative guidance under the Radio Law.
The ministry has permitted reallocation of 4G frequencies for 5G use.
SoftBank had applied to install base stations within fiscal 2020 after reallocating frequency bands, but only about two-fifths to three-fifths were actually installed.
The ministry urged completion of the shortfall within 2021.
・The Trans-Pacific Partnership (TPP) is expected to expand beyond Asia-Pacific.
Eleven participating nations agreed at an online meeting on the 2nd to begin negotiations for Britain to join.
China has shown interest in joining and is reportedly engaging informally with Singapore and others; Britain’s next membership is a focus.
・EU ambassadors agreed on the 2nd to add Japan to the list of countries permitted to travel within the bloc.
With COVID-19 infections subsiding and vaccination progressing, the EU plans to loosen criteria in May and gradually increase movement of people.
・Regarding the collapse of UK-friendly Greenhill Capital, Swiss financial giant Credit Suisse Group is pursuing funds recovered from SoftBank Group <9984> [Close 8,109 yen].
Lawsuits against SoftBank Group are being considered.
There is potential for legal wrangling to escalate.
・The U.S. dollar continues its decline.
The real effective exchange rate shows the dollar at its lowest level of the year so far.
This reflects excess dollar liquidity created by fiscal stimulus and monetary easing.
Over the past year, dollar money supply grew 30%—much faster than the 10% growth seen in Japan and Europe.
A phenomenon where dollars that have nowhere to go “reflow” back to the Federal Reserve.
・In New York on the 1st, crude oil futures hit a high not seen in 2 years and 7 months briefly.
OPEC+ reaffirmed a plan to gradually unwind coordinated production cuts through July.
However, uncertainty surrounding the Iran nuclear deal kept investors oscillating, keeping closing prices modest.
・Global COVID-19 infection counts (daily new deaths) as of 4:00 PM on 6/2, compiled by Johns Hopkins University: Worldwide 171,180,000 (15,105 deaths)
United States 33,287,563 (645) India 28,307,832 (3,207) Brazil 16,624,480 (2,408) France 5,738,641 (134) Turkey 5,256,516 (129) Russia 5,022,881 (366)
United Kingdom 4,506,333 (0) Italy 4,220,304 (93) Argentina 3,817,139 (640) Germany 3,692,908 (180) Spain 3,682,778 (30) Colombia 3,532,422 (523)
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