Limit on Olympic spectators set to 10,000
June 18, 2021 (Fri) Fine then cloudy; Mercury retrograde (5/30–6/23)
・The government on the 17th announced that, excluding Okinawa, the nine prefectures will be lifted on the 20th as scheduled for the state of emergency.
Among them, Tokyo, Osaka, and six other prefectures will transition to the "priority measures to prevent the spread" similar to a state of emergency.
New measures and state of emergency until 7/11 will continue for Okinawa Prefecture.
Priority measures to prevent the spread: Hokkaido, Tokyo, Saitama, Chiba, Kanagawa, Aichi, Osaka, Kyoto, Hyogo, Fukuoka
Alcohol service will be permitted until 7:00 p.m. in Chiba, Aichi, and Fukuoka prefectures.
Hyogo Prefecture will allow until 7:00 p.m. on weekdays, and will urge restraint on weekends and holidays; continued self-restraint will be requested of Tokyo as well.
・Prime Minister Yoshihide Suga on the 17th referred to the response to COVID-19 after the state of emergency is lifted at the Prime Minister's Office. If infections show signs of re-expanding and straining medical care
“we will respond flexibly with measures such as a blanket suspension of alcohol service and stricter limits on events,”
and he said, “-most importantly, we must avoid a large rebound.”
・On the 17th, the government reviewed infrastructure export strategies through 2025.
At the G7 Summit, which closed on the 13th, regarding coal-fired power plants that have not taken measures to reduce greenhouse gas emissions
they reflected the agreement to end new export support within the year.
Japan, the only G7 country supporting exports, aligned with the United States and Europe and shifted its policy.
・Hitachi <6501> [Closing price 6181 yen] plans to invest a total of 300 billion yen in the medical and health fields from 2021 to 2023.
It will collect high-quality data with the world-leading blood analysis and other devices and analyze with artificial intelligence (AI).
It will commercialize a service that detects cancer precursors from trace amounts of genes.
Looking ahead to the post-COVID-19 growth areas.
・During the summit between the United States and Russia on the 16th, they agreed to begin bilateral talks toward building a new framework for nuclear disarmament.
There is also intent to deter China and Russia from getting closer.
・In countries with high COVID-19 vaccination rates, cases are rising again in succession.
In the UK, the daily new infection numbers surged, delaying the easing of restrictions.
Behind this are delays in the two-dose vaccination effectiveness and variants spreading.
Severe cases continue to decline.
・The U.S. Federal Reserve (Fed) indicated at the FOMC on the 16th that
it plans to move up the timing of the end of the zero-interest-rate policy to 2023, ahead of the previously assumed end of 2024.
This is a course correction driven by the recovery of the U.S. economy and accelerating inflation, but a concrete plan for tapering is postponed for now.
Chair Powell said, “The economy is recovering from a deep hole.”
In the median projections of the 18 FOMC participants, 13 expect rate hikes to begin in 2023. In March, only 7 expected that.
The outlook has changed to anticipate two 0.25% rate hikes in 2023.
・The government on the 17th announced that vaccine certificates will be issued by mid-July.
First, a paper certificate will be used, with consideration given to a digital option.
It will be issued to facilitate business travel and for overseas travelers.
・In 2020, the share of cashless payments in Japan’s personal consumption rose to a record high of 29.7%, up 2.9 points from 2019.
The government aims for 40% by 2025, but major countries have already reached 40–60%, and adoption is still lagging.
・Regarding the international common tax rules contemplated by major tech companies,
the G7 leaders are coordinating to carve out exceptions to target U.S. Amazon.com.
The plan is to tax the portion of profits exceeding a 10% margin, but applying it naively could exclude Amazon, so they will focus on high-margin cloud business.
They are adjusting toward a simple scheme that draws the line by sales and profit margins.
・Markets are pricing in earlier rate hikes than the Fed.
The Fed signaled two rate hikes by the end of 2023, but markets expect 3–4.
However, if employment recovers faster than expected or inflation accelerates, bets may shift earlier and markets could fluctuate.
・As Brazil’s economy, recovering from the COVID-19 crisis, faces new downside risks from climate change,
the Central Bank of Brazil on the 16th raised the policy rate by 0.75 percentage points to 4.25%.
The rate hike continues for a third meeting in a row. Price rises driven by high electricity prices and grain prices prompted this move.
・Global COVID-19 cases (deaths) as of 4:00 p.m. on 6/17, compiled by Johns Hopkins University: World total 177,040,000 (10,282 deaths)
United States 33,498,506 (368) India 29,700,313 (2,330) Brazil 17,628,588 (2,997) France 5,809,319 (48) Turkey 5,348,249 (71) Russia 5,189,260 (388)
United Kingdom 4,605,605 (9) Italy 4,248,432 (52) Argentina 4,198,620 (648) Colombia 3,829,879 (595) Spain 3,749,031 (36) Germany 3,726,768 (106)
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