Bloomberg Daybreak: Europe Edition Daybreak Weekend: Retail Earnings, European Banking, Japan Eco
Aug 15, 2025
Taro Komura, a leading Japan economist for Bloomberg Economics, dives into the latest trends shaping Japan's economy. He discusses the impact of rising inflation and the Bank of Japan's cautious approach to interest rates. Taro also highlights how U.S. tariff policies are affecting Japanese exports and the challenges posed by an aging population. His insights shed light on consumer behavior differences across generations, emphasizing the need for strategic economic responses in a rapidly changing landscape.
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Housing Starts Diverge By Segment
- Single-family housing starts are declining while multifamily construction rises, driven by builders matching production to weak demand.
- Builders hold record new-home inventory since 2007 and will limit new starts until spec inventory clears.
Watch Builder Incentives Closely
- Watch builder incentives like mortgage rate buydowns as they aim to clear inventory and attract marginal buyers.
- Expect incentives to remain elevated and potentially increase through the second half, pressuring builder margins.
Renting Rises As Homeownership Loses Appeal
- Higher mortgage rates and home prices are pushing many potential buyers toward renting, boosting renter household formation.
- A real housing recovery needs lower rates, some price declines, and income growth to restore affordability.