Why Japan’s Central Bank Is Holding Back on Rate Hikes
if you’ve heard Japan’s got high inflation but no rate hikes here’s what you’re missing it’s not your typical economic story for over 3 years Japan’s inflation has been above the Bank of Japan’s 2% target but unlike the US or Europe they’re not rushing to raise interest rates why because this inflation is different driven mainly by rice prices which have more than doubled this year in fact rice alone makes up almost half of Japan’s core inflation but the central bank says this is likely temporary caused by supply issues not wild spending plus Japan’s economy just shrank last quarter exports are falling and US tariffs could make things worse if the Bank of Japan tightens policy too soon it could hurt the fragile recovery or even bring back deflation which Japan has struggled with for years so for now they’re walking a tight rope watching waiting and hoping for growth [Music]
Japan’s inflation has stayed above target for over 3 years, but the Bank of Japan isn’t rushing to raise rates. Here’s why. #JapanEconomy #BOJ #Inflation #InterestRates #MarketUpdate
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