Chinese Business

Japan will spend $260 billion on a stimulus package to cushion the economy from the impact of inflation and the weak yen, Prime Minister Fumio Kishida announced on Friday.

But the central bank is refusing to budge from the ultra-loose policy that has hammered the Japanese currency this year, wiping out more than 20 percent of its value against the dollar.

The government hopes the 39 trillion yen in fiscal spending will rise to 72 trillion when private sector investments are taken into account, Kishida said after ministers approved an extra budget to partly fund the relief measures.

“We want to protect people’s livelihoods, employment and businesses, while strengthening our economy for the future,” he told reporters, adding that the move should help push up GDP by 4.6 percent.

Prices are rising in Japan at their fastest rate in eight years, although the three-percent inflation rate remains well below the sky-high levels seen in the United States and elsewhere.

Japan — which has one of the world’s highest debt-to-GDP ratios — has already injected hundreds of billions of dollars into its economy over the past two years to support recovery from the Covid-19 pandemic.

Friday’s package, funded by a special budget of $200 billion, will include measures to encourage wage growth and support households with energy bills, which have spiked since Russia’s invasion of Ukraine.

“We’ll aim to push down prices by more than 1.2 percent next year by lowering electricity bills by 20 percent and curbing gasoline prices,” Kishida said.

It is also designed to help people and businesses affected by the plummeting yen, currently at 147 against the dollar.

Japan spent nearly $20 billion in September in an effort to curb the yen’s slide, and further expensive government interventions have reportedly taken place in recent days.

– No change from Bank of Japan –

The yen’s steep falls have been driven by the widening gap between the monetary policies of the US and Japanese central banks — with the Bank of Japan keeping rates ultra-low to encourage sustainable growth, while the Federal Reserve ramps them up.

Following a two-day policy meeting, the BoJ said it would keep its easy-money policy, defying growing pressure to tweak its strategy as the yen drops.

Bank Governor Haruhiko Kuroda said officials would stick to their guns until prices rise “in a sustainable manner”, adding there would be no change “any time soon”.

Kuroda declined to comment on suspected currency interventions in the past week, which the finance ministry has not confirmed.

But “it is extremely important that (forex rates) reflect economic fundamentals, and move in a stable manner”, he told reporters.

“The recent depreciation of the yen is rapid and unilateral,” which is “negative for the Japanese economy”, Kuroda said.

Ahead of the BoJ meeting, UBS economists Masamichi Adachi and Go Kurihara said that a mix of continued easing by the central bank and the government’s stimulus measures would be “optimal”.

That is because Japan’s inflation is not demand-driven, but largely down to soaring energy costs, they explained in a commentary.

This view was echoed by Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute.

“Japan’s economy faces weak demand due to price rises, in contrast to the United States, where demand is strong, with the Fed trying to cool down inflation,” he told AFP.

“It’s impossible that Japan would hike rates to curb inflation, for this reason.”

Japan will spend $260 billion on a stimulus package to cushion the economy from the impact of a weak yen and inflation, Prime Minister Fumio Kishida said Friday.

But the nation’s central bank is refusing to budge from the ultra-loose policy that has hammered the currency this year, wiping out more than 20 percent of its value against the dollar.

The government hopes the 39 trillion yen in fiscal spending will rise to 72 trillion yen when private sector investments are taken into account, Kishida said after the cabinet approved an extra budget to partly fund the relief measures.

“This… is a comprehensive economic package meant to combat inflation and revitalise the economy,” he told reporters.

“We want to protect people’s livelihoods, employment and businesses, while strengthening our economy for the future.”

Prices are rising in Japan at their fastest rate in eight years, although the three-percent inflation rate remains well below the sky-high levels seen in the United States and elsewhere.

Japan — which has one of the world’s highest debt-to-GDP ratios — has already injected hundreds of billions of dollars into its economy over the past two years to support recovery from the Covid-19 pandemic.

Friday’s package will include measures to encourage wage growth and support households with energy bills, which have spiked since Russia’s invasion of Ukraine.

It is also designed to help people and businesses affected by the plummeting yen, currently at 147 against the dollar.

Japan spent nearly $20 billion in September in an effort to curb the yen’s slide, and further expensive government interventions have reportedly taken place in recent days.

The yen’s steep falls have been driven by the widening gap between the monetary policies of the US and Japanese central banks — with the Bank of Japan keeping rates ultra-low to encourage sustainable growth, while the Federal Reserve ramps them up.

– Bank of Japan stands pat –

Following a two-day policy meeting, the BoJ said it would keep its easy-money policy, defying growing pressure to tweak its strategy as the yen drops.

Bank Governor Haruhiko Kuroda told reporters officials would stick to their guns until prices rise “in a sustainable manner”, adding there would be no change “any time soon”.

Kuroda declined to comment on suspected currency interventions in the past week, which the finance ministry has not confirmed.

But “it is extremely important that (forex rates) reflect economic fundamentals, and move in a stable manner”, he added.

“The recent depreciation of the yen is rapid and unilateral,” which is “negative for the Japanese economy”, Kuroda said.

Ahead of the BoJ meeting, UBS economists Masamichi Adachi and Go Kurihara said that a mix of continued easing by the central bank and the government’s stimulus measures would be “optimal”.

That is because Japan’s inflation is not demand-driven, but largely down to soaring energy costs, they explained in a commentary.

This view was echoed by Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute.

“Japan’s economy faces weak demand due to price rises, in contrast to the United States, where demand is strong, with the Fed trying to cool down inflation,” he told AFP.

“It’s impossible that Japan would hike rates to curb inflation, for this reason.”

Most markets fell Friday as a weakening economy and disappointing earnings from tech giants offset signs that central banks could begin slowing their interest rate hike campaign.

After being battered for most of the year by worries that borrowing costs will continue to rise to fight inflation, traders were cheered by a report last week indicating the US Federal Reserve could take its foot off the gas soon.

That was followed by comments from policymakers hinting as much, while a string of data suggesting the world’s top economy was feeling the impact of higher rates also gave the bank room to manoeuvre.

Meanwhile, a below-expectation increase by the Bank of Canada this week and signs the European Central Bank could take a less hawkish turn helped fuel speculation of a softer outlook for rates, helping push government bond yields down around the world.

Focus is now on the Fed’s next policy decision on Wednesday.

While it is widely tipped to announce another bumper hike, traders will be poring over the post-meeting statement for clues about its plans for December and 2023, with hopes it will indicate a slower pace.

Data showing the US economy grew more than expected was tempered by underlying figures indicating, among other things, that consumer spending — the key driver of growth — remained fragile.

“The notion ‘bad news is good news’ is increasingly driving price action as Fed hikes expectations are lowered in the face of weaker data,” said SPI Asset Management’s Stephen Innes.

“Bank of Canada’s surprise 50 basis point hike on Wednesday, coupled with a less hawkish forward guidance from the ECB… added to the idea that peak tightening globally has passed.”

– Tech weakness –

However, Wall Street ended on a mixed note, with the Nasdaq losing more than one percent after forecast-missing earnings this week from some of the world’s biggest firms including Apple, Amazon, Facebook parent Meta and Google parent Alphabet.

“With tech performing so poorly, the messaging to markets is confusing many investors as the sharp slowdown in the fortunes of the tech sector contrasts with the outperformance of more traditional economic bellwethers,” said Michael Hewson at CMC Markets.

“The contrast is also outweighing the anticipation that central banks may be looking to slow the pace of their rate hiking cycle.”

The losses filtered through to Asia where tech was again in the firing line.

They were felt particularly in Hong Kong, where the Hang Seng Index shed more than three percent — at the end of a bruising week hit by worries that Xi Jinping’s tightened grip on power in China could see more crackdowns on the sector.

The sharp drop in the city came after rebounding slightly during the past few days, following a rout on Monday.

There were also losses in Tokyo as investors await a fresh stimulus package local media said could be worth as much as $200 billion as the government tries to kickstart the economy and cushion the country from inflation and a weaker yen.

The yen fell to more than 147 per dollar after the Bank of Japan held tight to its ultra-loose monetary policy and boss Haruhiko Kuroda said officials would not move until prices rose “in a sustainable manner”, adding there would be no change “any time soon”.

However, it was still stronger than the levels near 152 seen Friday that reportedly saw authorties intervene. The yen’s losses have been fuelled by the widening gap between the monetary policies of the US and Japanese central banks.

Elsewhere, Shanghai, Sydney, Seoul, Taipei, Manila, Bangkok and Jakarta were also down, while London, Paris and Frankfurt opened in the red.

However, Singapore, Wellington and Mumbai edged up.

– Key figures around 0810 GMT –

Tokyo – Nikkei 225: DOWN 0.9 percent at 27,105.20 (close)

Hong Kong – Hang Seng Index: DOWN 3.7 percent at 14,863.06 (close)

Shanghai – Composite: DOWN 2.3 percent at 2,915.93 (close)

London – FTSE 100: DOWN 1.0 percent at 7,000.03

Euro/dollar: DOWN at $0.9950 from $0.9965 on Thursday

Pound/dollar: DOWN at $1.1517 from $1.1567 

Dollar/yen: UP at 147.25 yen from 146.27 yen

Euro/pound: UP at 86.39 pence from 86.11 pence

West Texas Intermediate: DOWN 1.5 percent at $87.76 per barrel

Brent North Sea crude: DOWN 1.1 percent at $95.86 per barrel

New York – Dow: UP 0.6 percent at 32,033.28 (close)

Dinosaur fans got a glimpse of a Tyrannosaurus rex skeleton as it went on display in Singapore Friday before an auction next month, as experts slammed the big-money bone trade as “harmful to science”.

The 1,400-kilo frame, composed of about 80 bones, will be the first T-rex skeleton auctioned in Asia, according to Christie’s, which has not given an estimate for the lot.

Dubbed Shen, meaning god-like, it will be on display for three days before being shipped to Hong Kong to be sold in November.

“None of the 20 T-Rex that exist in the world is owned by either an Asian institution or an Asian collector,” said Francis Belin, president of Christie’s Asia Pacific.

“We really wish that Shen will find a new home amongst our Asian collectors here.”

The adult dino, which stands 4.6 metres tall and 12 metres long, is thought to be male. It was excavated from private land in the Hells Creek Formation in Montana in the United States in 2020.

“I’ve never seen a real-life fossil before… It makes me feel in awe because it’s quite majestic,” said Lauren Lim, 33, who went to view the exhibit.

— ‘Bad news for science’ —

Shen — which lived during the Cretaceous period about 67 million years ago — is not the only dino auctioned in recent years.

In July, the first skeleton of a Gorgosaurus went under the hammer for $6.1 million in New York. Another T-rex, “Stan”, was sold for $31.8 million by Christie’s in 2020.

But the trend for prehistoric auction lots has some experts concerned.

“It’s a sad thing that dinosaurs are becoming collectible toys for the oligarch class, and I can only hope this fad ends soon,” said Steve Brusatte, a paleontologist at the University of Edinburgh.

He told AFP the trend was “bad news for science”, and the remains belonged in museums.

Thomas Carr, a paleontologist from the US, described such sales as being “unquestionably harmful to science” even if the skeletons had been studied before being sold.

“A secure, permanent collection ensures that the observations that a scientist makes of a fossil can be tested and replicated — and a commercially held fossil has no such assurance,” Carr said.

Belin, of Christie’s, said he hoped a public institution would buy Shen, and added that the whole skeleton had been fully researched, recorded in 3D and “all the elements of the skeleton will be made available for the public to research”.

“We strongly hope that the new owner, whether it’s an institution or private, will ensure that it’s being seen by the public,” Belin said.

Japan is expected Friday to announce a huge stimulus package to cushion the economy from the impact of a weak yen and inflation, though the central bank refused to budge from the ultra-loose policy that has hammered the currency.

Ahead of cabinet approval for the relief measures, Prime Minister Fumio Kishida said the government would “seek swift approval” of an extra budget worth 29.1 trillion yen (around $200 billion).

Prices are rising in Japan at their fastest rate in eight years, although the three-percent inflation rate remains well below the sky-high levels seen in the United States and elsewhere.

The yen has also lost more than a fifth of its value against the dollar this year, prompting authorities to intervene to prop up the currency.

The spending package is expected to include measures to encourage wage growth and support households with energy bills, which have spiked since Russia’s invasion of Ukraine.

Local media including the Nikkei business daily said total fiscal spending on the measures could be as high as 39 trillion yen, a figure that could rise to 71.6 trillion yen when private-sector investments that ministers hope will also be made are taken into account.

Japan — which has one of the world’s highest debt-to-GDP ratios — has already injected hundreds of billions of dollars into its economy over the past two years to support recovery from the Covid-19 pandemic.

But this year the yen has been driven sharply lower by the widening gap between the monetary policies of the US and Japanese central banks, with the BoJ keeping rates ultra low to encourage sustainable growth, while the Federal Reserve is ramping them up.

On Friday, following a two-day policy meeting, the Bank of Japan said it would continue to keep its easy policy, defying growing pressure to tweak its strategy as the yen declines.

Ahead of the BoJ meeting, UBS economists Masamichi Adachi and Go Kurihara said that a mix of continued easing by the bank and the government’s stimulus measures would be “optimal”.

That is because Japan’s inflation is not demand-driven, but largely down to soaring energy costs, they explained in a commentary.

“An alternative mix, especially with tightening monetary policy to counter (the yen’s) depreciation and higher (consumer price) inflation under the current circumstances, would have a worse outcome for the economy, especially with market turmoil not only in Japan, but also in other markets,” the pair said.

This view was echoed by Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute.

“It’s understandable that the government is announcing new stimulus now, because Japan’s economy faces weak demand due to price rises,” he told AFP.

This is “in contrast to the United States, where demand is strong, with the Fed trying to cool down inflation”, he said.

“It’s impossible that Japan would hike rates to curb inflation, for this reason,” Shinke explained.

The Bank of Japan stuck to its ultra-loose monetary policies Friday, even as the yen comes under pressure from aggressive tightening by the US Federal Reserve and other central banks.

The stark contrast between Japanese and US monetary policy has caused the yen to plummet to 32-year lows against the dollar, prompting the government to intervene to prop up the currency.

In a statement after a two-day policy meeting, the BoJ said it would keep measures aimed at boosting the world’s third-largest economy, including its benchmark rate of minus 0.1 percent.

But it also raised its inflation forecast for fiscal 2022-23 to 2.9 percent, from 2.3 percent in July, driven by higher energy and food prices.

“The rate of increase is then expected to decelerate toward the middle of fiscal 2023,” as the impact of these price increases wanes, its statement said.

Bank of Japan policymakers have refused to move away from their ultra-loose stance, designed to encourage sustained price rises.

Meanwhile, the Fed and central banks in other major economies have embarked on a series of hawkish interest rate hikes in an effort to fight decades-high inflation.

This contrast has caused the yen to plummet dramatically from around 115 against the dollar before Russia’s invasion of Ukraine in February to around 146 on Friday morning.

The Japanese government spent nearly $20 billion in September in an effort to curb the yen’s slide, and further expensive interventions have reportedly taken place in recent days.

“The Bank of Japan policy meeting is a do-or-die moment for the Japanese yen,” Edward Moya, senior market analyst of Oanda, said in a note this week.

“If Japan wants to defend the yen, they might need to continue to intervene in the forex market,” or artificially influence rates through buying or selling government bonds, he added.

Japan is also on Friday expected to announce an economic stimulus package that local media said could be worth $200 billion to cushion the impact of inflation and a weak yen.

Most markets fell Friday as a weakening economy and disappointing earnings from tech giants offset signs that central banks could begin slowing their interest rate hike campaign.

After being battered for most of the year by worries that borrowing costs will continue to rise to fight inflation, traders were cheered by a report last week indicating the US Federal Reserve could take its foot off the gas soon.

That was followed by comments from policymakers hinting as much, while a string of data suggesting the world’s top economy was feeling the impact of higher rates also gave the bank room to manoeuvre.

Meanwhile, a below-expectation increase by the Bank of Canada this week and the signs the European Central Bank could take a less hawkish turn helped fuel speculation of a softer outlook for rates, helping push government bond yields down around the world.

Focus is now on the Fed’s next policy decision on Wednesday.

While it is widely tipped to announce another bumper hike, traders will be poring over the post-meeting statement for clues about its plans for December and 2023, with hopes it will indicate a slower pace.

Data showing the US economy grew more than expected was tempered by underlying figures showing, among other things, consumer spending — the key driver of growth — remained fragile.

“The notion ‘bad news is good news’ is increasingly driving price action as Fed hikes expectations are lowered in the face of weaker data,” said SPI Asset Management’s Stephen Innes.

“Bank of Canada’s surprise 50 basis point hike on Wednesday, coupled with a less hawkish forward guidance from the ECB… added to the idea that peak tightening globally has passed.”

However, Wall Street ended on a mixed note, with the Nasdaq losing more than one percent after forecast-missing earnings this week from some of the world’s biggest firms including Apple, Amazon, Facebook parent Meta and Google parent Alphabet.

“A lot went wrong for big-tech… Apple’s holiday outlook underwhelmed, inflation pain is more noticeable, and unfavourable exchange rates will hurt future sales,” said OANDA’s Edward Moya.

“The key theme across this round of mega-cap results is that an earnings slump is here as inflation cripples an already weak consumer.”

The losses filtered through to Asia where tech was again in the firing line.

They were felt particularly in Hong Kong, where the Hang Seng Index shed more than one percent — at the end of a bruising week hit by worries that Xi Jinping’s tightened grip on power in China could see more crackdowns on the sector.

There were also losses in Tokyo as investors await a fresh stimulus package local media said could be worth as much as $200 billion as the government tries to kickstart the economy and cushion the country from inflation and the weaker yen.

The yen was slightly lower against the dollar Friday, though it has bounced since hitting a fresh 32-year low last week.

– Key figures around 0230 GMT –

Tokyo – Nikkei 225: DOWN 0.4 percent at 27,248.20 (break)

Hong Kong – Hang Seng Index: DOWN 1.1 percent at 15,256.83

Shanghai – Composite: DOWN 0.9 percent at 2,956.74

Euro/dollar: UP at $0.9989 from $0.9965 on Thursday

Pound/dollar: UP at $1.1582 from $1.1567 

Dollar/yen: UP at 146.49 yen from 146.27 yen

Euro/pound: UP at 86.25 pence from 86.11 pence

West Texas Intermediate: DOWN 0.8 percent at $88.41 per barrel

Brent North Sea crude: DOWN 0.6 percent at $96.36 per barrel

New York – Dow: UP 0.6 percent at 32,033.28 (close)

London – FTSE 100: UP 0.3 percent at 7,073.69 (close)

Elon Musk is at turns ingenious, impulsive and infuriating. He is also a corporate maverick, unafraid to tackle  myriad industries by his own rules.

After revolutionizing the auto industry, sending his own rocket to space — with his car on board — and building the world’s biggest fortune, the eccentric billionaire is the new king of social media after he took charge of Twitter on Thursday and fired its top executives.

That will give him control of the network on which the world debates, mobilizes, bickers and throws shade, Musk often first among them.

The deal will also fuel the fire over his political views, business methods, outsized personality and unconventional personal life — flames he does nothing to douse.

He is libertarian, anti-woke and promotes himself as a champion of free speech. He has been accused of being autocratic and bullying.

“The reason I acquired Twitter is because it is important to the future of civilization to have a common digital town square” for healthy debate, Musk said earlier Thursday, while insisting it could not become a “free-for-all hellscape.”

His takeover of the social media juggernaut caps a months-long roller coaster of announcements, counter-announcements and legal maneuvering — which he characteristically punctuated by firing jabs at the company on its own platform.

It is the latest corporate conquest for Musk, after online publishing and payments, space travel and electric cars.

The 51-year-old is the richest person in the world, a title he took last year from Amazon’s Jeff Bezos following the meteoric rise of Tesla, his electric automaker founded in 2003.

– Newsmaker, for better and worse –

Musk’s businesses make headlines for the right reasons: his space transport firm SpaceX is a partner in a three-way venture that sent the first fully private mission to the International Space Station.

But his empire also makes news of a less flattering kind: Tesla has faced a series of lawsuits alleging discrimination against Black workers as well as sexual harassment.

In parallel with the whiplash-inducing stream of business news, Musk’s unconventional private life also keeps the world’s eyebrows raised.

Musk has had two children with his on-again off-again partner, the musician Grimes: a son, X AE A-XII, known as X, and a girl they named Exa Dark Sideræl Musk — although the parents will mostly call her Y.

He also fathered twins with a top executive in Neuralink, a company he co-founded.

One way or another, Musk has become one of the most ubiquitous figures of the era. So how did he get where he is today?

– To Mars… and beyond? –

Born in Pretoria, on June 28, 1971, the son of an engineer father and a Canadian-born model mother, Musk left South Africa in his late teens to attend Queen’s University in Ontario.

He transferred to the University of Pennsylvania after two years and earned bachelor’s degrees in physics and business.

After graduating from the Ivy League school, Musk abandoned plans to study at Stanford University in California.

Instead, he dropped out and started Zip2, a company that made online publishing software for the media industry.

He banked his first millions before the age of 30 when he sold Zip2 to US computer maker Compaq for more than $300 million in 1999.

Musk’s next company, X.com, eventually merged with PayPal, the online payments firm bought by internet auction giant eBay for $1.5 billion in 2002.

After leaving PayPal, Musk embarked on a series of ever more ambitious ventures.

He founded SpaceX in 2002 — now serving as its chief executive officer and chief technology officer — and became the chairman of electric carmaker Tesla in 2004.

After some early crashes and near-misses, SpaceX perfected the art of landing booster engines on solid ground and ocean platforms, rendering them reusable, and late last year it sent four tourists into space, on the first ever orbital mission with no professional astronauts on board.

Musk’s jokingly-named The Boring Company is touting an ultra-fast “Hyperloop” rail transport system that would transport people at near supersonic speeds.

And he has said he wants to make humans an “interplanetary species” by establishing a colony of people living on Mars.

To this end, SpaceX is developing a prototype rocket, Starship, which it envisages carrying crew and cargo to the Moon, Mars and beyond — with Musk saying he feels confident of an orbital test this year, possibly in November.

Musk, who holds US, Canadian and South African citizenship, has been married and divorced three times — once to the Canadian author Justine Wilson and twice to actress Talulah Riley. He has nine children. A tenth child died in infancy.

Forbes estimates his current net worth at $222 billion.

China’s “sharp and uncharacteristic” economic slowdown is expected to drag on growth across Asia through the end of next year, the International Monetary Fund (IMF) warned Friday, darkening an already gloomy global outlook.

Worldwide economic prospects have dimmed this year as countries have faced higher living costs, tighter financial conditions and increased uncertainty following Russia’s invasion of Ukraine.

The crises have dulled the rebound from the Covid-19 pandemic, even as Asia has remained a “relative bright spot” compared with other parts of the globe, the IMF said in its Regional Economic Outlook.

But growth in the region faces headwinds from a Chinese economy weighed down by a hardline zero-Covid policy and a crisis in the property sector, the organisation said.

Earlier this month, the IMF announced it had cut its growth forecast for China to 3.2 percent in 2022, which would be the smallest expansion of the world’s second-largest economy in around four decades, excluding the first year of the pandemic.

The new report downgrades the growth forecast for Asia to four percent this year, down 0.9 percentage points from a previous outlook in April.

The organisation said it expects China’s growth to rise to 4.4 percent and Asia’s to increase to 4.3 percent next year, still “well below” the average of about 5.5 percent over the past two decades.

China’s “broad-based” slowdown “is estimated to have important spillovers to the rest of Asia through trade and financial links”, according to the IMF.

It noted that the region may also face other “persistent” headwinds in the form of tighter global monetary policy and Moscow’s invasion of Ukraine, which has caused commodities prices to spike.

– Few infections, little growth –

“Asia’s strong economic rebound early this year is losing momentum, with a weaker-than-expected second quarter,” said Krishna Srinivasan, the director of the IMF’s Asia and Pacific Department.

Much of the growth shortfall “can be explained by lower levels of investment following the pandemic”, he said, adding that many countries should act to ease overhanging corporate debt and human capital losses.

He warned that economic fragmentation, driven by geopolitical tensions and uncertainty in trade policy, “poses a significant risk to the region” and could “have adverse macroeconomic consequences in the short term”.

China is the last major economy wedded to a zero-Covid policy, imposing snap lockdowns, mandatory testing and lengthy quarantines in an effort to tamp down any outbreaks as they arise.

Around 208 million people in the country are under some form of enhanced virus restrictions, Japanese bank Nomura estimated in a note on Monday.

Further issues have plagued the massive property sector as a series of debt-laden developers have defaulted on loans while others have struggled to raise cash.

Official data on Monday showed China’s economy grew 3.9 percent year-on-year in the third quarter, a stronger-than-expected performance that was announced after Beijing announced a delay in releasing the figures during a Communist Party congress earlier this month.

Analysts still expect the country to fall well below its stated annual growth target of about 5.5 percent.

Investors fled Chinese stocks earlier this week after President Xi Jinping broke long-standing precedent to seal a third term in power, fuelling fears that virus lockdowns and other measures harmful to the economy would continue.

Japan is on Friday expected to announce an economic stimulus package that local media said could be worth $200 billion to cushion the impact of inflation and a weak yen.

Prices are rising in the world’s third-largest economy at the highest rate in eight years, although its three-percent inflation remains below the sky-high levels seen in the United States and elsewhere.

The yen has also lost over 20 percent of its value against the dollar this year, prompting authorities to intervene at least once in recent weeks, with further moves to prop up the currency suspected though unconfirmed by the government.

Details of the stimulus spending will be announced later in the day, with public broadcaster NHK and other media outlets saying it will be more than 29 trillion yen (around $200 billion).

The plans include measures to support households with energy bills, which have spiked since Russia’s invasion of Ukraine, and to encourage wage growth.

Japan — which has one of the world’s highest debt-to-GDP ratios — has already injected hundreds of billions of dollars into its economy over the past two years to support recovery from the Covid-19 pandemic.

The main driver of the yen’s steep falls is the contrast between Japan’s longstanding monetary easing policies, designed to encourage sustainable growth, and aggressive US interest-rate hikes.

The Bank of Japan is expected to maintain its ultra-loose stance in a policy decision on Friday, despite growing pressure to tweak its strategy as the yen declines.

“It’s understandable that the government is announcing new stimulus now, because Japan’s economy faces weak demand due to price rises,” Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute, told AFP.

This is “in contrast to the United States, where demand is strong, with the Fed trying to cool down inflation,” he said.

“It’s impossible that Japan would hike rates to curb inflation, for this reason,” Shinke predicted.