As the walk through the BOJ continues, the reports, assessments and methodologies is pretty much the same for all central banks. Today’s BOJ to Producer Prices is the same number for all central banks. The BOJ and RBNZ charts to CPI and Imports Vs Exports reveals no difference. Posted side by side without the formal name, no difference exists nor can we say, this chart is BOJ and the other chart, RBNZ.
All central banks are dealing with high Inflation rates and all target 2%. GDP is low for all central banks. Most 10 to 3M bond spreads are negative. All central banks raised interest rates. All central banks labor supply is short. All central banks wages are low and under Inflation rates. All central banks unemployment rates rose and numbers are the same. All central banks Household Spending slowed. All central banks housing starts and purchases dropped.
If a recession hits then every nation in the world will experience recession as all the calculated economics is the exact same nation to nation.
Talk about one world government and no wonder why the rise of political authoritarians. Authoritarians always gain power under economic depressions, Hitler, Mao, Stalin, Hirohito in Japan, Obama and Biden. My favorite was Robert Mugabe of Zimbabwe.
The original point of note was to highlight if the BOJ for example was understood then the deep insights to all central banks are known.
Producer Prices
Most vital to producer prices is monthly index values because monthly adjustments hardly change but to know index values allows for monthly forecasts.
Here’s Index values for May and June 2022.
May = 106.80, June = 107.10. A difference of 0.3. The monthly release was 0.3.
June = 107.10, July = 107.30, a difference of 0.2. Reported Monthly change 0.2.
The methodology is find the difference between the previous 2 Index values and the range to producer prices is known. The yearly change is reflected in the monthly releases. If 0.2 is reported then the yearly value changes by 0.2.
Brian Twomey
Tianzuida ON TRADING 