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Zainab Khalid (120735)Manal Rafi (120732)FINANCIAL MARKETS AND INSTITUTIONSJAPAN

Table Of Contents

History of Japan Economic Overview GDP Inflation Imports/Exports Interest Rate Per Capita Income Stock Market Performance Currency Performance Conclusion

History Of Japan Japan is an Islandnation inEAST ASIA. About 73 percent of Japan is forested. It has 127.3 million population. Prime Minister Shinzo Abe.

Economic Overview

Japan is the world's largest liquefied natural gas importer. Japan's economic growth developed in theEDO PERIOD. Growth slowed markedly in the 1990s. The economy showed strong signs of recovery after 2005 GDP growth for that year was 2.8 percent.GDP (Gross Domestic Product)

The monetary value of all the finished goods and services produced within a country's borders in a specific time period. The Gross Domestic Product (GDP) in Japan is 0.40 percent in the fourth quarter of 2014.GDP Growth Rate in Japan averaged 0.49 percent from 1980 until 2014.Contd.By exports, Japans gross domestic product increased at an annualized rate of 2.2%.Reaching an all-time high of 3.20 percent in the second quarter of 1990 and a record low of -4 percent.Inflation

The rate at which the general level of prices for goods and services is rising, and, subsequently, purchasing power is falling.2.20 percent in February of 2015.Averaged 3.15 percent from 1958 until 2015.In Japan, the most important categories in the consumer price index are Food (25 percent of total weight) and Housing (21 percent). Contd.Transportation and communications 14 percentCulture and recreation for 11.5 percentFuel, light and water charges for 7 percent.Medical care for 4.3 percent.

Japan Vs US (Inflation)The Japanese average annual inflation rate in 1974 was 23.1% with the 12 month period ending in February 1974 actually reaching 25% inflation.Average annual U.S in 1980 at only 13.5%. March 1980 had a peak of 14.76%.

Imports/ExportsMotor vehicles, electronics,machine tools, steel, ships,chemical substances, textiles, and processed food.Japan's main export markets in 2012 were China (18.1 percent), the United States (17.8 percent), South Korea (7.7 percent), Thailand (5.5 percent) and Hong Kong (5.1 percent).Contd.Exports in Japan decreased to 5941.06 JPY from 6144.70 JPY Billion 2015. Exports in Japan averaged 3122.42 JPY Billion from 1963 until 2015.Japan would be importingnatural gas. Imports in Japan decreased to 6356.66 JPY Billion in 7322.20 JPY Billion .Imports in Japan averaged 2743.86 JPY Billion from 1963 until 2015.Contd.Japan's main imports are machinery and equipment,fossil fuels, foodstuffs, chemicals.Japan ranks 27th of 189 countries in the 2014.Interest RateThe amount charged, expressed as a percentage ofprincipal, by alenderto a borrower for the use ofassets. Interest rates are typically noted on an annual basis, known as theannual percentage.The benchmark interest rate in Japan was last recorded at 0 percent. Interest Rate in Japan averaged 3.07 percent from 1972 until 2015.In Japan, decisions on interest rates are made by the Bank of Japan's Policy Board in its Monetary Policy Meetings.

Contd.Bonds rate also varied from or fell from 2.45% in 2008 to 1.43% in 2015.T-Bills also fell from 5.7% in 1955 to 0.2% or almost 0% in 2015.Bank of Japan also says that this much low %age is due to almost no need of funds to government.

Per Capita IncomeThe Gross Domestic Product per capita in Japan was last recorded at 37432.91 .The GDP per Capita in Japan is equivalent to 296 percent of the world's average.

Stock Market PerformanceThe Japan Stock Market (NIKKEI 225) increased to 19652.88 Index points in April from 19206.99 Index points in March of 2015.The Nikkei 225 Stock Average Index is a major stock market index which tracks the performance of 225 top rated companies listed in the First Section of the Tokyo Stock Exchange.Contd.In 1943, the exchange was combined with ten other stock exchanges in major Japanese cities to form a single Japanese Stock Exchange.The combined exchange was shut down and reorganized shortly after the bombing ofNagasaki.In 2001, the TSE restructured itself as astock company.

Currency PerformanceNo true exchange rate existed for the yen between December 7, 1941 and April 25, 1949.After a period of instability, on April 25, 1949 the U.S. occupation governmentfixedthe value of the yen at 360 perUS $1 through a United States plan.In 1971 the yen had become undervalued.However, this trend of depreciation reversed after theglobal economic crisis of 2008.

ConclusionIn conclusion we can say that, years following World War II.Japan's industrial sector is heavily dependent on imported raw materials and fuels.Global demand for Japan's exports in late 2008 pushed Japan further into recession.