It's the end of the first year of Abenomics. Prime Minister Shinzo Abe won election in December, 2012.
<p>
Abe introduced several measures to help Japan's poor economy and battle deflation. Under Abe, the Bank of Japan in January set its inflation target to 2%.
<p>
So far the results are mixed. While the risk of deflation looks lower, the main effect has been in the value of its currency. The yen has weakened against the dollar by about 20% in 2013 and is likely to continue weakening in 2014. Japan may be fixing its deflation internally by exporting deflation.
<p>
There are many unanswered questions about Japan:
- what effect will its shrinking population have on the economy?
- how coupled is Japan's economy with China's?
- will Japan's economy grow?
- how will Japan's huge debt level (over 200% of GDP) be resolved?
No comments:
Post a Comment