1. Yen Weakness Manipulation Allegations, Finance Minister: “Groundless”
Finance Ministers of the United States and Japan (Source: TBS news)
- One-line summary: Finance Minister Shunichi Suzuki stated “Japan does not intentionally lower the yen” and said he would explain this directly at the G20 meeting.
- On April 18, at the House of Councillors Finance Committee, Finance Minister Shunichi Suzuki emphasized that as the dollar/yen exchange rate threatens the 160 yen level, “We are keeping all options open to ease market volatility, but there is no intention to artificially lower the value of the yen.” He added that he would explain the same logic to the US side at the IMF and G20 finance ministers’ meeting in Washington from the 21st to the 26th. Japan has defended the yen with net purchases of 9.79 trillion yen since May 2024, but the prevailing view in the market is that “dollar strength and the interest rate gap between Korea and the US are structural causes.” While large export companies are expected to see improved performance due to exchange rate effects, the surge in energy and food import prices has pushed consumer inflation to the mid-to-high 2% range, increasing the burden on households. Bloomberg and Reuters suggested that the BOJ might consider additional rate hikes at its June meeting.
2. Nikkei 225 Posts Largest Weekly Gain in 3 Months
Nikkei records largest weekly rise in 3 months (Source: JNN)
- One-line summary: The Nikkei 225 rose 3.41% for the week, closing at 34,730.28 points, reflecting optimism about trade negotiations.
- On April 18, the Nikkei 225 rose 1.03% in Tokyo trading, up 3.41% for the week, marking the largest weekly gain since early January. The index tested an 18-month low (32,000 level) early in the week due to concerns about Trump’s “tariff bombs,” but successfully made a V-shaped rebound as positive signals emerged from the US-Japan trade negotiations held from the 14th to 17th. Leading sectors included pharmaceuticals (▲4.7%), boosted by positive Phase 3 clinical trial news for obesity treatments, and shipping (▲3.9%), which saw improved profit forecasts due to rising freight rates. In contrast, semiconductor stocks showed mixed performance as profit-taking emerged following the impact of the US’s 104% tariffs on Chinese goods. Trading volume averaged only 3.2 trillion yen per day as foreign investors were thin due to the Easter holiday.
3. M5.1 Earthquake in Nagano, No Tsunami Warning
Magnitude 5.0 earthquake in Nagano Prefecture (Source: NHK)
- One-line summary: A magnitude 5.1 earthquake hit northern Nagano Prefecture on the night of April 18, with no casualties but aftershock warnings issued.
- According to the Meteorological Agency, the earthquake occurred at 8:19 PM on the 18th at a depth of 10 km, recording a maximum of 4 on the local seismic intensity scale. Tsunami warnings were immediately lifted as there was no risk, but some sections of the JR Chuo Line operated at reduced speeds of 25 km/h, causing trains to be delayed by up to 30 minutes. The Nagano Prefecture Disaster Response Headquarters announced that cracks and falling roof tiles were confirmed in 17 aging houses, but evacuation was not necessary. Experts advised caution as aftershocks of intensity 1-2 could continue for several days due to the characteristics of nearby active faults.
4. Yamanote, Keihin-Tohoku Lines Reduced by 60% on Weekend
- One-line summary: Track relocation work at Tamachi Station will reduce operations on both lines by up to 60% between first train and noon on April 19-20.
- JR East has begun major construction to move the tracks between Tamachi Station and Shinagawa Station 120 meters eastward in preparation for the new direct line to Haneda Airport (scheduled to open in 2031). As a result, the outer loop of the Yamanote Line (Ueno→Osaki) on the 19th and the inner loop (Osaki→Ueno) on the 20th will be completely suspended for certain sections, while the Keihin-Tohoku Line (Higashi-Jujo~Shinagawa), which runs along the same section, will also operate with reduced service. Passengers can use alternative routes such as the Tokaido Line and Metro services free of charge, and JR Pass and Suica commuter passes will be automatically processed for transfers. JR explained that once construction is completed, platform width will double to 12 meters, and train intervals during peak hours can be reduced to around 2 minutes.
5. Fukushima Reactor No. 2: First 0.7g of Fuel Debris Retrieved
- One-line summary: The ‘Telesco’ robot recovered 0.7g of melted nuclear fuel debris, marking a significant turning point in decommissioning work.
- Tokyo Electric Power Company announced on April 15 that it had retrieved 0.7g of melted fuel and zirconium mixed debris from a point 2 meters inside the containment vessel of Fukushima Daiichi Nuclear Power Plant’s No. 2 reactor using the remote robot ‘Telesco’. This is the second achievement since the first trial retrieval in November 2024, with analysis confirming the presence of uranium, zirconium, iron, and concrete components. The removal of an estimated total of 880 tons of debris aims for mass extraction in the late 2030s, but the work faces difficulties due to high radiation levels and fragmentation. Based on the sample data, the government and TEPCO plan to finalize technical specifications such as robot gripper strength and pool storage methods, and to review the complete decommissioning roadmap targeted for 2051.
6. Foreign Visitors to Japan Hit 10.54 Million in Q1, ‘Record-Breaking Pace’
- One-line summary: With 3.5 million visitors in March alone, Japan is on track to break annual records.
- The Japan National Tourism Organization (JNTO) announced on April 16 that the ‘number of foreign visitors in Q1 2025’ reached a cumulative 10.54 million, surpassing 10 million by March for the first time ever. The weak yen, visa relaxation, and cherry blossom demand acted as combined positive factors. By country, visitors came from South Korea (2.5 million), China (2.36 million), and Taiwan (1.62 million). Tourists spent 2.27 trillion yen, making tourism Japan’s ‘2nd largest export item’ surpassing automobiles, while raising concerns about accommodation and transportation infrastructure overload in provincial small and medium-sized cities. The Ministry of Land, Infrastructure, Transport and Tourism decided to introduce a pilot ‘Smart Travel Week’ program in 2026 to distribute peak season crowds.
7. Bank of Japan: All 9 Regions in ‘Moderate Recovery’… Additional Rate Hike Possible
- One-line summary: BOJ quarterly report maintains economic recovery assessment, strengthening the case for June rate discussions.
- The BOJ held a meeting of regional branch managers on April 15 and released its ‘Regional Economic Report (Sakura Report)’, describing all nine regions as “continuing to recover.” While tourism consumption and wage increases support domestic demand, the report noted the risk that manufacturing profitability could deteriorate if the Trump administration’s 25% automobile tariff becomes reality. Governor Ueda mentioned that “further normalization is possible if a virtuous cycle of wages and prices is confirmed,” fueling speculation that the benchmark interest rate could be raised by another 0.25 percentage points at the June meeting.
8. Osaka Expo Opens… 235 Billion Yen ‘Giant Wooden Ring’ Controversy
- One-line summary: The expo opened on April 13 with the theme ‘Designing Future Society’ but faces pressure from budget increases and sluggish ticket sales.
- EXPO 2025 OSAKA, KANSAI, which opened on the artificial island of Yumeshima, features over 150 participating countries showcasing robots, flying cars, and biotechnology. Prime Minister Shigeru Ishiba emphasized being a “bridge connecting a divided world” in his opening ceremony speech, but the total construction cost has nearly doubled from the initial 125 billion yen to 235 billion yen, drawing national criticism. In particular, the circular wooden building ‘Grand Ring’ designed by Sou Fujimoto, which accounts for 14% of the budget, has come under scrutiny. Advance ticket sales reached only 9 million out of the target 14 million, making the commercial success uncertain. The Federation of Economic Organizations expects economic effects of up to 3 trillion yen from tourism demand, but challenges remain, including incomplete pavilions and methane gas safety issues.
9. Defense Budget at 9.9 Trillion Yen, 1.8% of GDP… ‘2% Goal by 2027’ Accelerated
- One-line summary: Defense Minister Nakatani unveiled the 2025 fiscal year budget proposal, focusing investment on AI, space, and long-range missiles.
- On April 15, the Ministry of Defense set defense and related costs for fiscal year 2025 at 9.9 trillion yen. This represents a 14% increase from 2024 (8.7 trillion yen) and corresponds to 1.8% of GDP based on three years ago. The budget will be allocated to hypersonic interception systems, high-power lasers, satellite cluster networks, and autonomous unmanned vessels. It also includes AI automation, improved environments for female service members, and training for drone operation personnel to compensate for declining troop numbers. The government reconfirmed achieving 2% of GDP by 2027 as an ‘irreversible goal’ and plans to finalize the joint development contract for the next-generation fighter GCAP with the US, UK, and Italy within this year.
10. Golden Week Travelers Expected to Decrease by 6.9%
- One-line summary: In its April 3 announcement, JTB estimated total travelers at 23.45 million, citing ‘inflation plus calendar’ headwinds.
- According to the ‘Golden Week (April 25-May 7, 2025) Travel Trends’ released by travel agency JTB, the number of people traveling domestically and internationally is expected to decrease by 6.9% year-on-year to 23.45 million. Domestic travelers are forecast at 22.9 million (-7.2%), with inflation and the shorter holiday structure suppressing demand, while international travelers are expected to reach 550,000 (+10%) despite the weak yen, focusing on short-distance routes. The proportion of trips lasting ‘3 nights, 4 days’ or longer increased by 5.5 percentage points, showing clear polarization between long and short trips. JTB estimated total travel spending at 985.5 billion yen, noting the possibility of last-minute cancellations due to fluctuations in prices and exchange rates as a risk factor.