- January 27, 2023
- Posted by: Stratford Team
- Category: Economy
TOKYO, Jan 27 (Reuters) – Japanese Prime Minister Fumio Kishida said on Friday that a return to deflation in the world’s third-largest economy cannot be ruled out, because domestic demand remains weak.
The comment came hours after data showed Tokyo’s consumer inflation, a leading indicator of Japanese price trends, hit a 42-year high in January, keeping the central bank under pressure to phase out its easy monetary policy.
However, Kishida told a session of the upper house of parliament that inflation was being driven by high global raw material prices and a weak yen, not by strong domestic demand.
Asked by an opposition lawmaker if the Japanese economy has fully exited from years of deflation, Kishida said: “the state of non-deflation is going on at the moment, but it has not reached a stage where we can judge that the return (to deflation) is unlikely.”
The Bank of Japan (BOJ) surprised financial markets last month with a decision to allow 10-year bond…
