Japan’s household spending massively beats expectations, boosting case for further BOJ hikes
Japan’s household spending in December rose 2.7% year on year in real terms, according to a Friday report from the Statistics Bureau of Japan, massively beating expectations from economists polled by Reuters and marking its first rise since July 2024.
The figure sharply beat Reuters expectations of a 0.2% rise, boosting the case for another interest rate hike from the Bank of Japan.
The data comes after the BOJ in January raised its benchmark policy rate to 0.5%, its highest since 2008. The BOJ has long stated that it would raise rates if it sees a “virtuous cycle” of higher prices and growing wages.
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—Lim Hui Jie
S&P 500, Nasdaq close higher
The S&P 500 and Nasdaq Composite finished Thursday’s session in positive territory.
The broad market index gained 0.36% to close at 6,083.57, while the tech-heavy Nasdaq climbed 0.51% to finish at 19,791.99. Meanwhile, the blue-chip Dow Jones Industrial Average fell 125.65 points, or 0.28%, to settle at 44,747.63.
— Sean Conlon
UBS sees gold prices climbing to new all-time highs going forward
Tariff concerns have already sent gold prices to fresh all-time highs this week, but UBS believes the precious metal could advance even higher in valuation.
In a Friday note, UBS raised its gold forecasts to $3,000 per ounce over the next 12 months. Spot gold was last trading $2,849.89 per ounce after hitting an all-time high of $2,882.16 on Wednesday.
“Our base case remains that significant tariffs against Canada and Mexico are unlikely to be sustained for a prolonged period, and that the ratcheting up of the U.S.’s effective tariff rate on China to 30% will be gradual,” UBS wrote. “But, we also believe gold will continue to be supported throughout the year by elevated uncertainty, an extension of the global rate-cutting cycle, and strong investor and central bank demand.”
“Direct exposure to the metal may dampen risk in portfolios,” the bank added. “Equities linked to gold (such as gold miners) may offer greater capital gains potential but are likely to be more volatile and act like equities in times of risk aversion. We believe gold and the means to invest in it (directly or indirectly) should form part of a well-diversified portfolio,” the note said.
— Lisa Kailai Han