JAPAN’S ANNUAL MONEY SUPPLY GROWTH RATE

841 WordsJul 8, 20184 Pages
JAPAN’S ANNUAL MONEY SUPPLY GROWTH RATE In November, Japan’s industrial production increased output of cars for foreign customers. However, the nation’s retail sales continued to fall. The output of Japan’s factories and mines gained significantly. The output will reinforce expectations that recover in overseas demand. The various efforts could help prevent Japan’s economy from going back into recession of growth. The works of the U.S. and China will continue the upward trend in output thanks to the demands. Manufacturers are expecting their output to rise 3.4 % in December. However, other data shows that Japan’s domestic demand remains weak. This will keep the nation’s recovery vulnerable to slowdown in overseas growth.…show more content…
Like the rest of the world, Japan has in fact been experiencing inflation. The Bank of Japan increased its annual inflation rate to 1.8% from 1.1%. Japan will increase in consumer prices (goods and services) which should lead to higher company profits and wages, and domestic spending in the economy. Japan’s increase is mainly imported and increasing food and energy prices. Japan is an importer of goods and Japanese companies are not benefitting from this inflationary environment. In 1992, stocks fell, and real estate and assets were affected and they call this the,” Bubble Burst”. How this came about is the financial system was dominated between politician, financial institutions, and regulatory authorities and they limited bankruptcy. Regulatory and market innovations subsidized risk taking from both financial institutions and their business clients. Monetary policy focused Japan’s yen appreciation and high GDP growth rates, low inflation rates, and made asset values increase. Increased monetary growth led to increased bank lending. This increased the demand for land, real estate, and equities. During the time of the Bubble Burst low interest rates led to rising asset prices. The bank of Japan raised the discount rate with tight monetary policy for four years. The decline in the assets prices weakened bank balance sheets, investments, and consumption

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