Biden's new administration welcoming ships in a strict alert What is the impact on the Japanese economy?

On the 21st of Japan time, the US administration will change and Democratic Party Joe Biden will become the 46th president.

The inauguration in Washington, DC, is usually in a festive mood, but this time the new administration welcomes its departure in a strange atmosphere of turmoil over the presidential election and invasion of parliament. I will.

President-elect Joe Biden of the United States will attend the inauguration ceremony in Washington, DC, before noon on the 20th and before 2:00 am on the 21st of Japan time, and will take an oath to become the 46th president.

The theme of the inauguration is "American Unity," and in his inauguration speech, Mr. Biden is expected to appeal for the reconciliation of the divided society that he has appealed through the election campaign.

However, the celebration mood has not spread to Washington, and armed National Guards have been killed and injured in response to the invasion of Trump's supporters who became mobs in response to the election results and caused casualties. It is surrounded by a strange atmosphere that is alert.

Vice President Mike Pence will attend the ceremony in addition to successive presidents such as former President Obama and former President George W. Bush, but President Trump, who is dissatisfied with the election results, has revealed that he will not attend in a way that breaks conventional practice. I will.

It is the first time in about 150 years that the predecessor president has not attended the inauguration ceremony of the new president.

This time, due to the spread of the new coronavirus, the annual parade has been canceled and the square in front of the Capitol, which is usually filled with citizens, has also been closed.

At the age of 78, Biden, the oldest president in American history, will start a new administration in an unusual situation.

Republican Senate Top Criticizes President Trump for Parliamentary Invasion

Republican Senate leader Mitch McConnell said on Wednesday that supporters of the mob Trump broke into Congress and were killed or injured. "The mobs have been lied to. They have been told Trump. It was tempted by the president and other powers, "he said, recognizing that President Trump's words and deeds had caused it.

President Trump's denunciation trial is expected to take place in the Senate, but conviction requires the approval of not only Democrats but some Republicans, and the top Republican Senate has clearly criticized the president. Attention is being paid to how that affects the whereabouts of the Senate trial.

Large-scale stimulus measures Whether the positive for the Japanese economy depends on the corona

What kind of impact will the inauguration of President-elect Biden have on the Japanese economy?

Although large-scale economic stimulus measures will be taken by experts, exports from Japan will increase and have a positive effect on the Japanese economy, but there are many views that it will depend on the infection status of the new coronavirus in the medium to long term. It has become.

President-elect Biden has called for a tax increase for businesses and the wealthy, while raising a large-scale fiscal stimulus.

As the spread of infection continues, it is expected that the economic stimulus measures by fiscal mobilization will be prioritized first, and on the 14th of this month, additional economic measures totaling 1.9 trillion dollars and 200 trillion yen in Japanese yen I announced the plan.

At a press conference, President-elect Biden said, "There is an urgent need for effective fiscal mobilization to keep the budget deficit. Such investment will prevent economic deterioration in the long run, and the profits obtained will cost money. It will be much higher. "

The local media said, "If it is established, it will be the largest economic measure in the history of the United States," and it is expected to have the effect of supporting the American economy centered on personal consumption.

However, it is unclear whether the US economy will recover in the medium to long term.

In the United States, nearly 400 trillion yen has already been invested as an economic measure to deal with the new coronavirus, the financial situation is rapidly deteriorating, and monetary policy has stepped into the zero interest rate policy.

In order to put the economy on a full-scale recovery trend in the future, it is essential not only for these fiscal and financial policies but also for the spread of infection to be quickly resolved, but at what speed the developed vaccine will spread. I can't see if I will.

In addition, the whereabouts of relations with China, where conflicts have intensified under the Trump administration, are unknown.

President-elect Biden is expected to take a strict stance on China, leaving risks to the global economy if relations do not improve.

The Japanese economy is expected to rely on exports for the time being, as domestic demand is inevitably down due to the state of emergency.

For this reason, the outlook for the Japanese economy is likely to depend largely on whether the economy of the United States, the second largest trading partner, is heading for recovery.

Japanese financial market perception

The appointment of Mr. Biden as the new president of the United States is a perception of the Japanese financial markets.

First of all, in the stock market, there are many views that stock prices will remain firm for the time being, as the US economy is affected by the spread of the new coronavirus infection and aggressive fiscal stimulus and large-scale monetary easing will continue. It has become.

However, some market participants are wary that the gap with the real economy is further progressing, and it seems that transactions will continue while keeping an eye on the infection situation in Japan and overseas and the trends of the world economy.

There are some different views on the yen exchange rate.

The US Federal Reserve Board has clarified its policy of continuing quantitative easing measures to supply a large amount of money to the market for a long period of time, so the dollar is likely to depreciate against major currencies such as the yen. There are many market participants who expect that the Fed will continue.

On the other hand, there is also a view that long-term interest rates in the United States will rise further as government bonds are issued under Mr. Biden, who is still in the budget deficit, such as an economic measure plan of 200 trillion yen in Japanese yen.

It is generally said that the currency of a country tends to rise as long-term interest rates rise, and market officials say that "the trend of long-term interest rates in the United States is likely to be the key."

How US Trade and Environmental Policy Changes

How will America's trade and environmental policies change when President-elect Biden takes office, and what impact will it have on Japan?

First is the "trade" field.

President-elect Biden is negative about the Trump administration's sanctions on tariff increases and the WTO's disregard for the World Trade Organization.

However, in order to emphasize domestic employment, it has announced a policy of introducing an additional tax on products produced overseas, and is cautious about participating in free trade agreements such as the TPP = Trans-Pacific Partnership Agreement. I am.

There is also a view that protectionist policies will not change, and the Japanese government will call for cooperation toward the promotion of free trade.

Under the Trump administration, Japanese companies were also affected by regulations to stop the supply of semiconductors to Chinese telecommunications equipment giant Huawei.

President-elect Biden has also shown a strong stance against unfair trade with China.

The conflict between the two major economies of the United States and China is expected to continue, and the Japanese government and companies are likely to continue to face difficult responses.

On the other hand, in the field of "environment", the attitude of the United States is expected to change significantly.

President-elect Biden has indicated that he will return to the Paris Agreement, an international framework for combating global warming, which President Trump has left.

In the automobile industry, the policy is to place emphasis on investment in the green field, such as installing charging stations at 500,000 locations and launching a policy to support the production and purchase of electric vehicles, and there is also a global trend toward "decarbonization". It is expected to accelerate.

While it is expected that Japanese companies, including automobile manufacturers, will be forced to accelerate technological development, there is also the possibility of acquiring new business opportunities.

The Japanese government, which aims to realize a carbon-free society by 2050, is also aiming for strategic cooperation.

In addition, it has been pointed out that President-elect Biden will take a strict stance on human rights issues such as child labor and forced labor.

It seems that China is in mind, but it seems that Japanese companies will be required more than ever to understand the actual situation and respond promptly to see if there are any human rights problems in the process of trading.