Posted 10/10/2023, 9:00:00 PM
Bank of Japan Faces Balancing Act as Deflation Gives Way to Rising Prices
- Japan's central bank faces challenge of fighting deflation and rising inflation simultaneously
- Long-term deflation is legacy of 1990s economic stagnation when falling prices hurt growth
- Since 2016, BOJ has tried supporting prices with ultraloose policy like negative interest rates
- BOJ aims to achieve sustained 2% inflation target to boost economic activity
- Factors like weak yen, post-pandemic inflation, Russia-Ukraine war add pressure on BOJ policy
