Global Economic Uncertainty from Western Politics, Emerging-Market Economies and Geopolitical Risks

「Uncertainty continued due to the delayed recovery of the Chinese economy, the prolonged situation in Ukraine, heightened tensions in the Middle East, and developments in trade and monetary policies in various countries.」

「In addition to the prolonged situation involving Russia and Ukraine and escalating tensions in the Middle East, the increase and intensification of regional conflicts could cause substantial volatility in crude oil prices, energy prices, raw-material prices, logistics costs and foreign exchange rates.」

「The global economy continued to grow moderately overall during the six months ended, but downside risks to economic activity remained due to U.S. trade policy, slower growth in China and the unstable situation in the Middle East. The domestic economy remained generally firm, supported by personal consumption as wage increases progressed, while capital investment and employment conditions showed signs of recovery. However, uncertainty remained in the domestic and overseas business environment due to persistently high energy and material prices, yen depreciation, growing uncertainty surrounding the outlook as the United States moved to raise tariff rates, and continuing geopolitical risks related to international affairs.」

「The global economy continued to grow moderately overall during the six months ended, but growth was weighed down by slower growth centered on China's property downturn, heightened geopolitical risks including in the Middle East, and persistently high inflation in some regions. Japan's economy also continued to improve moderately, but remained lacking in strength as higher prices restrained real purchasing power and consumer sentiment stagnated. Political developments also created uncertainty about the future direction of the economy.」

「During the first nine months of the fiscal year, the United States was seeking the timing of the end of rate hikes and the start of rate cuts in pursuit of a soft landing. In Japan, the pass-through of higher raw-material and other costs was progressing, increasing the impact of high prices on consumers. Wage increases were attracting attention, as was the timing of the Bank of Japan's exit from its zero-interest-rate policy. Meanwhile, China's economy continued to slow, particularly in the property sector, from the previous spring, raising concerns about its impact on the global economy.」

「During the first six months of the fiscal year, prices continued to rise in the United States and interest-rate increases to combat inflation continued, while expectations of an end to rate hikes emerged and the struggle continued between curbing economic overheating and avoiding a recession. In Japan, although the Bank of Japan reviewed its interest-rate policy, the yen continued to weaken due to differences in monetary policy from Europe and the United States, exacerbating price increases and significantly affecting people's lives. In China, an economic slowdown and slower growth have become increasingly apparent, including concerns about defaults by major property developers.」

「During the first quarter of the fiscal year, the global economic environment remained characterized by rising prices and competing concerns about continued interest-rate increases to combat inflation and a recession resulting from higher rates. At the same time, optimism that the economy could achieve a soft landing without a recession was beginning to spread in the markets.」

「During the fiscal year, domestic and overseas economies were disrupted by higher resource and raw-material prices, supply constraints and strained logistics that emerged as COVID-19 infections subsided and conditions moved toward normality. Russia's invasion of Ukraine further exacerbated the disruption by causing oil and natural gas prices to surge. Against this backdrop, many countries, including the United States, raised interest rates to curb inflation resulting from historically high prices, amid concerns about a recession caused by inflation and higher rates. Financial instability also became a concern as mid-sized banks, including SVB in the United States, failed and Credit Suisse, a long-established Swiss bank, was acquired by UBS in a rescue merger.」

「During the first nine months of the fiscal year, the global economy remained clouded by uncertainty as record price inflation continued and monetary authorities in Europe and the United States pursued aggressive tightening and raised interest rates, with concerns about inflation and recession colliding sharply. The dollar-yen exchange rate also underwent historic fluctuations: amid differences in monetary policy, the yen rapidly weakened from the ¥115 range at the beginning of the year to the ¥150 range in October, before retreating to the ¥130 range following the Bank of Japan's policy adjustment in December.」

「During the first six months of the fiscal year, resource and raw-material prices rose amid the effects of COVID-19 and the turmoil caused by Russia's invasion of Ukraine, while historically high inflation progressed in many countries and regions, including the United States. Central governments continued exceptional interest-rate increases to contain inflation, raising concerns about a global recession. In Japan, the yen depreciated substantially due to differences in monetary policy from the United States, the EU and elsewhere, with higher import prices contributing to rising prices.」

「During the first quarter of the fiscal year, the global economic environment was in an extremely difficult phase. Prices continued to rise and inflation concerns intensified, while countries including the United States accelerated interest-rate increases, amid competing concerns about a recession caused by higher rates. The turmoil resulting from Russia's invasion of Ukraine, which began in February 2022, further drove up resource and raw-material prices. In addition, the yen weakened as differences in monetary policy between countries widened, and the effects of price increases caused by the weaker yen have become increasingly pronounced in Japan.」

「During the nine months ended the third quarter, the global economy was on a recovery trend, but restrictions on economic activity due to the worldwide spread of COVID-19 continued. Rising prices spread as a result of higher resource prices, including crude oil, supply constraints, and strained logistics. With inflation concerns emerging in the United States and discussions of reduced monetary easing and higher interest rates, the economy faced increasingly difficult decisions.」

「During the first six months of the fiscal year, states of emergency related to COVID-19 were repeatedly lifted and reimposed, and the situation remained uncertain as infections rose and subsided in turn. Meanwhile, as the global economy began moving toward normalization with the progress of vaccinations, it was forced to confront new challenges, including higher resource and material prices due to supply constraints, strained logistics and labor shortages.」

「During the first quarter of the fiscal year, the economic environment remained uncertain, with conditions still severe in Japan, including major cities such as Tokyo, under states of emergency due to the spread of COVID-19. Some regions and countries overseas also remained in similarly difficult situations, while resource and material prices rose in anticipation of a post-COVID recovery and economic activity picked up in countries where vaccinations were progressing, raising concerns about inflation.」

「While the spread of infections is expected to subside and economic activity to recover as vaccination becomes more widespread, concerns remain about a renewed increase in infections due to the spread of variant strains, and the situation remains difficult to foresee.」

「During the first nine months of the fiscal year, the global economy remained in a difficult situation, contracting substantially due to the global COVID-19 pandemic. A second state of emergency was declared in January 2021, but infections have continued to resurge intermittently as social and economic activity has been gradually stepped up. The impact on domestic and overseas economies therefore requires close monitoring, and the outlook is expected to remain uncertain for the time being.」

「During the first six months of the fiscal year, the global economy remained in a difficult situation due to the spread of COVID-19. Economic activity gradually resumed after the state of emergency was lifted, and an economic recovery is expected, but the situation remains difficult to predict as there has been no marked decline in infections.」

「Following the spread of the novel coronavirus, domestic and overseas economic activity slowed substantially, and economic growth is expected to remain significantly negative going forward. The timing of a return to normal economic activity at home and abroad also remains unforeseeable.」

「During the first nine months of the fiscal year, there were no new business risks and no material changes to the business risks described in the previous fiscal year's securities report.」

「During the second quarter of the fiscal year, the global economy became even more uncertain due to the effects of the U.S.-China trade tensions and uncertainty surrounding the UK's withdrawal from the EU, making the situation difficult to predict.」

「During the first quarter of the fiscal year, the global economy became even more uncertain due to the effects of the U.S.-China trade tensions and uncertainty surrounding the UK's withdrawal from the EU, making the situation difficult to predict.」

「Meanwhile, signs of an economic slowdown have strengthened in Europe, while China's growth rate has also slowed, indicating some weakening in economic conditions compared with the previous fiscal year. In addition, the outlook for the global economy remains uncertain due to the direction of the UK's withdrawal from the EU and trade tensions between the United States and Japan, China and Europe.」

「During the first nine months of the fiscal year, the global economy continued to expand in the United States, supported by solid employment and personal consumption despite a temporary decline in stock prices. However, the economy slowed in Europe, China and emerging markets, leaving the global economy generally lacking momentum. In addition, concerns about an economic downturn resulting from the prolonged U.S.-China trade tensions and the adverse effects on business activity of the lack of progress in the UK's negotiations to leave the EU are making the outlook for the global economy uncertain.」

「In addition, concerns about an economic downturn resulting from the prolonged U.S.-China trade tensions and the adverse effects on business activity of the lack of progress in the UK's negotiations to leave the EU are making the outlook for the global economy uncertain.」

「During the first quarter of the fiscal year, the global economy continued to perform well, but the protectionist trade policies of the U.S. administration have increased uncertainty about the outlook, making the situation difficult to predict.」

「However, the outlook for the global economy remains uncertain due to political developments in the West, concerns about the outlook for emerging-market economies, and rising geopolitical risks.」