Japan’s Economy on the Up: BOJ’s Sakura Report Reveals Progress and Challenges

Bank of Japan lowers economic outlook for 7 out of 9 regional economies while highlighting robust wage growth.

On April 4, 2024, the Bank of Japan (BOJ) released its quarterly Sakura report, which revealed that seven out of nine regions in Japan have been downgraded due to weak private consumption and auto production. Despite this, the economy as a whole is still in recovery process.

The BOJ has highlighted positive indicators such as wage hikes spreading from larger firms to smaller ones in its report. This suggests that the central bank’s 2 percent inflation target is achievable. Additionally, changes in corporate price-setting behavior could further contribute to economic growth.

In particular, regions such as Hokkaido and Shikoku show promise for economic improvement despite the challenges faced by Tokyo and Tokai, where Toyota Motor Corp. is headquartered. The BOJ continues to closely monitor these regions and the overall economic situation in the country.

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