Nikko AM on 4Q Outlook

The transcript discusses the economic outlook, focusing on inflation, bond yields, and market trends. It highlights the potential for a Goldilocks scenario, where economic conditions are just right. The discussion covers projections for bond yields and equity markets, emphasizing macroeconomic factors like labor tightness and inflation. Concerns about the bond market and treasury yields are addressed, along with the impact of budget deficits. The transcript also explores the yen's value and the Bank of Japan's policies, noting potential interventions to prevent excessive yen weakness.

What is the expected trend for bond yields by the end of the year?

• They will be unpredictable.

• They will fall to 3%.

• They will remain stable.

• They will rise significantly.

What is the predicted S&P index value for September next year?

• 3500

• 4000

• 4660

• 5000

Which macroeconomic factor is expected to provide a positive trend for equity markets?

• High inflation

• Labor market tightness

• Increasing interest rates

• Mild growth in G3 economies

What is a major concern for the bond market according to the discussion?

• High inflation rates

• Stable government budgets

• No clear floor for bond yields

• Lack of demand for bonds

What level is the Ministry of Finance likely to intervene to prevent yen weakness?

• 140

• 150

• 130

• 160

What is the Bank of Japan's stance on the JGB market?

• Reducing interest rates

• Aggressively intervening

• Increasing assets significantly

• Stepping out of the market

What is the expected stance of the BOJ compared to the ECB and the Fed over the next 12 months?

• More aggressive

• Unchanged

• More hawkish

• More dovish