Any increase in interest rates in the US will be directly reflected in the retail trade sector in Japan, according to a forecast of Standard & Poor's Ratings. This will be a secondary effect of weakening the JPY and push the overall decline in emerging economies.
Weak JPY is negative scenario for the Japanese retailer, which is defined as strongly dependent on China. On the other hand, however weakening JPY could strengthen expectations that export-oriented Japanese economy will turn to recovery and there will begin to return optimism in consumers. But this is a much slower process.
As the main risk is the slowdown in emerging economies. This factor remains the greatest weight in the analysis and possible action of the Fed will push a strong negative effect on consumer sentiment and spending in Japan.
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