Japan’s 25-Year Battle With Deflation

The Japanese government has signaled economic recovery with increasing prices and wages, but there is growing concern over higher living expenses. Despite the highest pay offers in decades and core inflation exceeding the Bank of Japan’s target, the government did not officially declare an end to deflation, indicating continued uncertainty. This underscores the deeply rooted deflationary mindset of households and companies, despite significant fiscal spending and ultra-loose monetary policy, highlighting the ongoing struggles of the Japanese economy.