Reported 11 months ago
The Japanese government is drafting an annual economic blueprint that highlights the importance of collaborating closely with the central bank and adjusting policies flexibly amidst weak consumption and uncertain inflation outlook. The draft emphasizes the need to maintain stable inflation around the Bank of Japan's 2% target and aims for sustained wage growth exceeding inflation. It addresses challenges including lackluster consumer spending, volatile currency exchange rates, global economic risks, and the transition from a deflationary economy to one with increased productivity and higher prices. The government plans to present the draft to ruling party members for discussion before finalizing it in a Cabinet meeting on June 21, with proposals for smoother cost pass-through in various industries. Prime Minister Kishida's administration is under pressure due to a weakened yen and rising living costs, prompting a focus on boosting wage increases. Meanwhile, the Bank of Japan recently ended eight years of negative interest rates and may consider further rate hikes contingent on sustained inflation progress.
Source: YAHOO