Global Weakness Threatens Japan Recovery [1]

By: Takashi Nakamichi, 02/04/2014

TOKYO—The sharp drop in Japanese stocks underscores a vulnerability of the "Abenomics" recovery: Weakness in overseas economies may undermine the success of measures to jump-start growth at home. "Economies are all connected, and we're really worried about how far the impact will reach" from the recent emerging-market turbulence, Toyoaki Nakamura, chief financial officer of Hitachi Ltd. 6501.TO -1.43% , said Tuesday, even as the electronics giant raised its earnings forecast for the fiscal year ending next month, predicting a record profit. Much of the boom engineered by Prime Minister Shinzo Abe in 2013 was driven by a big expansion in monetary stimulus from his handpicked Bank of Japan governor, which pushed down the value of the yen against the dollar and other major currencies.

 

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