Japan’s inflation accelerated in December, industrial output gained and a measure of demand for workers strengthened, signaling gains for Prime Minister Shinzo Abe’s campaign to end two decades of stagnation.
Japan fell behind European nations in a ranking of the best places to do business compiled by Bloomberg, underscoring the need for Prime Minister Shinzo Abe to take bolder steps to reduce regulation and attract companies.
Japan’s inflation accelerated to the fastest pace since 2008 last month, bringing the rate closer to policy makers’ target while threatening to erode household spending power unless employers boost wages.
Half a year after Bank of Japan Governor Haruhiko Kuroda unleashed record monetary easing, economists see the bank failing to meet its inflation target, underscoring the case for stronger steps to revive the economy.
Hurdles for Japan’s economy next year may increase after Prime Minister Shinzo Abe’s visit to a shrine honoring war criminals and others risked deepening tensions with his nation’s largest trading partner.
Bank of Japan officials see significant scope to boost government bond purchases if needed to achieve their inflation target, according to people familiar with the discussions, signaling little concern with perceptions of underwriting fiscal deficits.