Bank of Japan Governor Kazuo Ueda hinted that the Japanese economy is recovering moderately, with a policy meeting scheduled for next week。Many speculate that a decision to end negative interest rates may be on the agenda as people call for higher wages and high prices discourage consumption of food and daily necessities。

Japan's economic landscape

Japan's gross domestic product (GDP) grew by 0% in the fourth quarter of 2023.4%, helping the country avoid a technical recession。However, although the number is small, the growth has received attention, and the expectation is to expand this number to 1.1%。

Economists are pleased with the current growth, as the last report showed a contraction in GDP。In July-September 2023, Japan's economy shrank by 3.3%。The economy shrank by 0 over the same period..8%。The economy was supported by strong capital spending, which rose 2% on a quarterly basis.。The government had expected a decline of 0.1%, but the actual number is still below 2.5% consensus expected increase。

The decline in these indicators varies with the recession and is driven by a number of factors - widespread labor shortages; a slowdown in the COVID-19 global recovery; higher labor demands; and the demographic crisis in the country.。

Pressure is always on to pull the economy up and match global economic highlights。The labor force in hand is very limited, but it may become stronger as more data is released。Japanese companies are reviewing measures to raise wages, recognizing that prices are rising。Nonetheless, inflation remains above 2% and the removal of negative interest rates may be postponed until the next meeting.。

Coping with uncertainty

Private consumption fell 0.3%。Rising inflation continues to have a negative impact on domestic demand and private consumption。As a result, the Bank of Japan is considering whether it is necessary to lower its consumption and factory output assessments at its meeting scheduled for March 18-19, 2024.。

Japanese government officials positive on its future expansion。Tibet province reports fourth quarter spending up 16 in period.4%, seasonally adjusted, equivalent to about 10 per quarter.4%。

The challenges facing Japanese companies include the need to balance two factors: prices and wages。A simple principle is that the higher the price, the higher the salary, and conversely, the higher the price, the higher the expenditure. The opportunity lies in finding ways to adapt to global dynamics and take advantage of NEPAD。

Looking to the future

Japan remains one of the fastest growing economies in the world。In the last quarter of 2023, GDP grew by 0.4%。Factors that could lead to a slowdown in economic growth are the ambiguity of economic decision-making and the weakening of support to curb inflation。Japanese companies can still drive economic growth if they agree with workers on wages。