站在十字路口的日本：它能逃脱通货紧缩的陷阱吗？

SEPTEMBER 2025 FOCUS Will Japan escape its deflationary trap?Ongoing capex boom holds the key EXECUTIVE SUMMARY How did inflation return to Japan?Since 2022, Japan has undergone a notable inflationary shift, with headline inflation consistentlysurpassing the Bank of Japan’s 2% target. Initially driven by cost-push factors like high commodity prices and a weak yen, this inflationarypressure has gradually evolved into a more demand-led phenomenon. Domestically focused service firms, facing margin squeeze withlimited offset from higher yen-denominated overseas revenues, began passing higher costs onto consumers. Rising living expenses, Is it sustainable?The sustainability of this inflationary trend hinges on continued wage growth, which itself depends on sustainedcorporate profit growth through productivity-enhancing investment. Encouragingly, Japanese firms are beginning to shift away from adecades-long focus on cash hoarding toward proactive investment in automation and R&D. This pivot is supported by stronger earnings, The emerging winners and losers.Japan’s reflationary environment has so far broadly supported corporate earnings. Manufacturers—particularly in the automotive and electric machinery sectors—have benefited from higher yen-denominated overseas revenues, thoughthis momentum may be challenged by rising U.S. tariffs and improving yen strength. Non-manufacturers, especially in accommodationand catering and transport, have gained from robust domestic consumption, booming inbound tourism, and enhanced pricing power. In Since the early 1990s, the Japanese economy has been experiencing a long period of near-zero or even negative inflation, following thecollapse of the asset price bubble in stocks and land. The economy technically entered deflation in 1998, triggered by a surge in non-performing loans (NPLs) stemming from the sharp decline in land prices. This deflationary environment has persisted for nearly threedecades. During this period, Japan’s headline inflation only inched up modestly amid temporary spikes in oil prices and currency fluctuations. However, signs of inflation began to emerge in 2022, driven by a combination of surging food and energy prices and structural tighteningin the labor market. These developments have begun to challenge Japan’s long-standing stagnancy in pricing and wage-setting, fuelinghopes of a potential regime shift in Japan’s long-lasting deflationary environment.2 countries reduced labor demand in Japan and exerted downward pressure on wages, especially for low-skilledworkers. However, the subsequent depreciation of the yento around ¥140 per dollar by 1998 should have alleviatedsome of the import-driven deflationary pressures.Leveraging againbut still net saving In parallel, IT-driven productivity gains also played a roleinsuppressing inflation by improving efficiency.Forexample,enhanced price transparency enabled by ITadvancementshelped streamline Japan’s traditionallyhigh-margin distribution system. While such gains areinherently deflationary, they were largely concentratedin the tech and manufacturing sectors. Therefore, theymay not have been sufficient to drive broad-based pricedeclines—especially if inflationary pressures in areas like declines, but these should not have inevitably resultedin entrenched deflationary pressures. One key driver wasthe sharp appreciation of the yen, which rose from above¥200 per U.S. dollar before the signing of the Plaza Accord1to a peak of ¥80 in 1995 (Chart 3 next page). This currencystrengthaccelerated the inflow of low-cost goods,1985199019952000200520102015 services with less productivity gains provided a meaningfuloffset. This dynamic is reflected in the continued rise of CPI despite similar technological progress. Over the longerterm, these advancements can also become inflationaryif productivity gains are broadly shared through higher On the demand side, Japan experienced a textbookcase of debt deflation loop, where falling asset prices,rising real debt burdens, and weak demand reinforced a Eurozonedeflationary spiral. As land prices collapsed(Chart 3), thevalue of collateral held by borrowers eventually fell belowthe value of debt by a widespread manner around 1998. JapanUSThis triggered a so-called “balance sheet recession” wherehouseholds and firms had to prioritize debt repaymentover consumption and investment to repair their balance 51001980198519901995200020052010201520202025By early 2010s, the technical constraints of Japan’s balancesheet recession had largely dissipated, but the deflationarymindset persisted. After nearly two decades of corporateand household deleveraging, many firms had repairedtheir balance sheets. Some had resumed borrowing, as reflected in the renewed rise of interest-bearing financialliabilities(Chart 4)and the uptick in non-financial corporate Leveraging againbut still net savingdebt(Chart 5). Although stronger financial positions andhistorically low interest rates encourag