Nakajima Quant Desk - English

📊 A deep dive into Japan's Q2 2026 GDP Second Preliminary Estimate from the Cabinet Office.

Real GDP was revised up from +0.3% to +0.4% QoQ (annualized +1.1% to +1.4%).

📉 But beneath the headline, domestic demand contribution stayed negative. Private capex fell for a second straight quarter, and housing/public investment were revised down.

💡 On the bright side, real compensation of employees was revised sharply higher, signaling accelerating wage growth.

⚠️ We break down what this mixed picture means for the BOJ's rate path, JGB yields, equities, and the yen.

▶️ Full video on YouTube: https://youtu.be/o76GbmDHoZA

📊 Japan's Ministry of Finance released July 2026 balance of payments (preliminary).

The current account swung back to a ¥2.99tn surplus (+¥402.6bn YoY) from June's rare ¥92.3bn deficit — a V-shaped rebound. 💡 The engine: primary income of ¥4.29tn, i.e., returns on Japan's overseas investments.

📈 Strengths: exports up 24.1% YoY (11th straight monthly gain) led by semiconductors; services deficit narrowed; foreign investors bought ¥1.79tn of Japanese equities.

⚠️ Weaknesses: imports surged 25.9%, widening the trade deficit as oil (+60.2% in USD) and a weak yen (¥162.55/USD) pushed costs up; inbound tourism growth stalled at +0.1%.

A balanced deep dive into Japan's structural shift from trading nation to investment-income nation.

▶️ Full video on YouTube: https://youtu.be/7LellW2inKc

📊 This week's three key US macro reports, explained.

Initial jobless claims held at a historically low 206,000, signaling labor market resilience. 📈

But the Fed's overnight reverse repo buffer has drained to just $525 million weekly, while Treasury's cash rebuild squeezed bank reserves by $287 billion year-over-year. ⚠️

Energy supply stayed firm even as demand softened 4% YoY. 💡

Labor, energy, and liquidity — three crosscurrents investors should watch heading into next week.

▶️ Full video on YouTube: https://youtu.be/XLnPSXDUkX0

📊 US nonfarm payrolls surged +162,000 in August, far outpacing the prior 12-month average of just 31,000.

✅ June and July payrolls revised up a combined +55,000

✅ Unemployment held steady at 4.1%, part-time-for-economic-reasons fell 414,000

⚠️ But the Information sector shed 23,000 jobs and teen unemployment jumped to 14.1%

💡 A broadening, resilient labor market—but with pockets of weakness. We break down what it means for the Fed's rate path.

▶️ Full video on YouTube: https://youtu.be/pIT8NBwLCW4

📊 The US goods & services trade deficit widened 24.4% to $88.6B in July 2026, up $17.4B from June, per the Census Bureau and BEA (FT-900).

📈 The standout: capital goods imports surged $14.4B in a single month — computers +$6.9B, computer accessories +$6.6B, semiconductors +$1.2B — pointing to an AI/data-center capex boom. YTD computer imports have nearly doubled YoY.

📉 Exports fell $6.6B, dragged by crude oil (-$4.5B) and nonmonetary gold (-$3.9B).

💡 Yet the year-to-date deficit is DOWN 29.6% vs 2025, with exports up 12%. A complex report mixing one-month deterioration with structural improvement.

⚠️ Country mix is shifting: Mexico ($27.5B) now tops the deficit table, with Vietnam and Taiwan ahead of China. Next release: Oct 6.

▶️ Full video on YouTube: https://youtu.be/iWXfyrRwI3c

📊 Broadcom (AVGO) reported fiscal Q3 2026 results: revenue of $29.6B (+86% YoY) and non-GAAP EPS of $3.32 (+96% YoY) — both record highs.

🚀 The engine: AI semiconductor revenue hit $16.7B, up 221% YoY and 54% QoQ.

⚠️ But infrastructure software grew just 29%, revealing rising concentration risk on a single AI-driven segment.

💡 Q4 guidance calls for $34.8B in revenue (+93% YoY). Whether AI demand sustains this pace is the next key question.

▶️ Full video on YouTube: https://youtu.be/vzxm4Vm-UzQ

📊 A deep dive into the Fed's July Beige Book.

Districts reporting solid job gains jumped from just 1 last time to 5 this cycle, while price growth cooled or held steady across all 12 Districts.

📈 A rare Fed-friendly combo: labor market resilience plus broadening disinflation.

⚠️ But Minneapolis and Richmond show firms struggling to pass through cost increases, squeezing margins. Consumer spending is splitting K-shaped by income, and agriculture worsened in 6+ Districts.

💡 How Chair Warsh's FOMC reads these anecdotes could shape the pace of future rate cuts.

▶️ Full video on YouTube: https://youtu.be/qcm68ZKjDbI

📊 The U.S. Census Bureau's July durable goods report shows total new orders at $663.6B, up 0.9% and rebounding from two straight monthly declines.

📈 Core capital goods shipments — the real-time gauge of capex execution — rose over 1% for a second consecutive month.

⚠️ But core capital goods orders, the forward-looking proxy for business investment, came in essentially flat after May and June's strong gains.

💡 Volatile transportation and defense orders inflated the headline number. We break down what it really means for investors. Next release: Oct 2.

▶️ Full video on YouTube: https://youtu.be/yR9VS9E3x04

The Bank of Japan released July 2026 Monetary Base data on Aug 4. The year-on-year decline widened to -13.8%, the 11th straight month of deepening contraction. 📉

Current account balances fell -16.6% and reserve balances -15.3%, confirming BOJ's quantitative tightening is proceeding on schedule via reduced JGB purchases.

Meanwhile, banknotes in circulation fell only -1.9% — cash demand itself is not collapsing. 💡

We break down what this means for JGB yields and the yen. 📊

▶️ Full video on YouTube: https://youtu.be/QjAed3xV3Lg

📊 A deep dive into the July 2026 JOLTS report from the U.S. Bureau of Labor Statistics.

Job openings rose slightly to 7.3 million. But hires fell 278,000, quits dropped 157,000, and the quits rate slipped to 1.9%.

📉 Layoffs also fell by 119,000, pointing to a synchronized slowdown in both hiring and firing -- a "low-churn" labor market.

💡 Healthcare stayed hot at a 5.7% openings rate, while professional & business services openings fell for a 4th straight month.

⚠️ We break down what this means for Fed rate cuts, the dollar, and equities -- with balanced analysis on both sides.

▶️ Full video on YouTube: https://youtu.be/4FC_-eKugDc