The yen falls sharply vs. the greenback with dollar/yen +1.1% to ¥98.00 following a report Shinzo Abe's government is considering a corporate tax cut.
The idea to cut the corporate tax comes as the government increasingly looks to be moving forward with a big hike in the national sales tax - a momentum-killer for the Japanese economy on more than one occasion throughout these two lost decades. A note from JPMorgan this morning has that desk believing the boost will go through as expected, with a final decision coming in October.
The news also boosted stocks, with the Topix climbing 2%. Even after struggling for the last quarter, the Topix is 35% higher on the year. It trades at 1.2x book value compared to 2.5% for the S&P 500 and 1.7% for the Stoxx Europe 600.