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Asia-PacificJune 1 2017

Japan takes a radical approach to spark economic revival

Negative inflation, stagnant wage growth and an ageing population are forcing Japanese policy-makers to take innovative and, some would say, counterproductive measures to revive the economy. Stefania Palma reports.
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By the end of March 2017, Japan’s economy had grown for the fifth consecutive quarter, its longest streak of economic expansion in more than a decade. But wages remain stagnant, corporates are hoarding cash and consumer confidence remains low.

The Japanese central bank, the Bank of Japan (BoJ), is opting for aggressive and innovative forms of monetary easing in an attempt to revive the economy. But some market participants believe the BoJ’s measures are either insufficient (in that they should be accompanied by sound structural reforms) or even counterproductive.

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