Japan's prices are rising, but will it last?

Prices on consumer goods and food haven't changed in 15 years.

I lived in Japan in the early-mid-2000s, and unitl Covid, I visited every year.

The something-or-other that was ¥598 in 2005 is ¥598 now (or at least until 2019 when I last visited).

That will be balanced within a short time lag , as always. If no one or less people buy it, because they can’t afford it anymore, they will have to reduce the prices right afterwards quickly, because otherwise they won’t sell anything and the profits also turn down to zero. In fact they even all go into red and bankruptcy, if nothing is sold but the costs for staff and storage stay. So it’s completely your fault yourself if you pay any high prices you complain about, not theirs.

Prices have to rise because of sanctions.

It's about the wages of Employee. It's not always by the Gov and private equity firms. This situation created by normal people.

Can't argue with your logic BackpackingNepal. Inflation, stagnant wages and increasing wealth of the 1 percent is all because of those greedy workers agitating for a living wage. They should know their place.

@dagon

It's about the wages of Employee. It's not always by the Gov and private equity firms. This situation created by normal people.

Just when I think I've seen the most biased, pro-government, pro-BoJ, anti-worker piece of gaslighting possible, something like this comes along.

Let's ignore the fact that a few months later, UK exports to the EU had not just bounced back, but risen to their highest in years!

Could you provide figures to back this up? All I could find was "By December 2021, leaving the single market and customs union had reduced UK goods trade by 14.9 per cent. And new analysis shows that UK exports have taken a larger hit than imports." (https://www.cer.eu/insights/cost-brexit-december-2021)

Abenomics has permanently depreciated the Yen and weakened Japan's purchasing power.

The rising price is a permanent trend as well as the declining wages.

Just wait Japan……….. The UK is going through the worst cost of living crunch in more than 20 years, fuelled by Covid, the global depression and the war in Ukraine. Wages and pensions have stayed the same, energy bills have doubled, food prices up, National Insurance going up in April.

Don't think that might have tiny bit to do with Brexit?

Nope, not even a tincy wincy bit. Only an idiot would think that, hope that helps you.

When State issue money not corresponding to productivity, when food size is shrinking, when population is ageing and reducing, when women need to work and prefer fashion to family, this is bound to be expected in the next 30 years.

See Japan slowly now digging its grave like some other countries too which think people are assets and not a living being with intelligence.

Let's just not think from only one side. What about struggling small companies? They're having hard time as well, not just you moaning. One of your family member might be working in their company and you do want the salary to be increased, right? So do they, thus price rises.

Small biz is being hurt by the vulture capital practices of private equity firms and the government prioritizing big, connected corporations for corporate welfare. Not because some staff want a living wage.

Thanks for propogating a false narrative BackpackingNepal.

Workers who want to be paid a living wage are not the cause of inflation.

Let's just not think from only one side. What about struggling small companies? They're having hard time as well, not just you moaning. One of your family member might be working in their company and you do want the salary to be increased, right? So do they, thus price rises.

A big reason Japan's economy is stagnant are the massive debt levels and many zombie companies kept alive by artificially low interest rates. Plus shrinking demographics. Nothing to do with lack of inflation or lack of pay increases. Pay increases do not cause inflation. Money supply (and a few other things) do. and anyway, inflation doesn't cause real economic growth.

At Tokyo-m

Brexit transition period ended in January 2021, not 2020, with U.K. exports to EU countries falling by 45 percent on the previous month and imports decreasing by 33 percent

Matthew HopkinsToday  02:23 pm JST

I understand that really well, I am a craftsman, my income fluctuates all the time and I rarely have any disposable income it is basic needs only.

Last time I went back to Canada I stopped with my children to get a sandwich.

I forgot we weren't in Japan.

A kaiser roll with ham and cheese lettuce is extra condiments were extra no drink 16 Canadian dollars.

That was for one sandwich.

I can go into Dotour get a nicer sandwich with coffee for half that price.

Even if I ate McDonald ( which I don't) a big Mac is over $1 cheaper in Japan than Canada and $1.50 cheaper than in the USA.

Nuts

This long standing shibboleth that a little inflation is somehow beneficial is ridiculous. Just a central bank scam to allow them to get away with all of their monetary malarkey.

The US is where prices are going through the roof for everything, gas, food, necessities, every day products, insurance, sports equipment, etc, etc. Can't believe it. Not good.

And there are plenty of trees ie soft wood lumber to be had in Japan but the people to cut it aren’t there.

Obviously you don't understand International markets!

And no there isn't plenty of wood in Japan Hokkaido is the best source and even then it's not enough even for Japan let alone to replace 23% of the world's supply that Russia was supplying.

Then there's a simple logistics the wood may be there but are the facilities for cutting and processing it are there enough people is there enough infrastructure?

This reads like something from another era. Who in this country is trying to "achieve" inflation? I'd guess that most of us reading this will experience inflation as a huge problem, specially if it mirrors what's happening in other countries all around the world.

The huge gap in this pining for inflation thing is the absence of wage increases. In real terms, most of us have been experiencing wage cuts and reductions in living standards. So inventing dumb catchphrases that try to blame the consumer for economic stagnation does nothing to address the basic problem. I have only seen wage cuts and no wage increase in over 20 years here. Of course I don't want to see prices rise. Economics 101.

See how much those biscuits or cereals cost when the volume and weight are compared to the prices either outside Japan or to years gone past in Japan.

Japan had inflation way before the present price increases.

And there are plenty of trees ie soft wood lumber to be had in Japan but the people to cut it aren’t there.

I don't believe these price comparisons or this inflation stuff especially when it's written by foreign news agencies.

I keep reading these lists stating how expensive Japan is and it's more expensive than XYZ countries or cities.

Then with a little bit of research you find out they're using what I call the Gaijin zones as a point of reference in Japan.

They use things like a kilo of beef a kilo of potatoes a loaf of bread and if they compare rice well they don't compare Japonica rice with Japonica rice in those countries they compare Japonica rice in Japan to the cheaper long grain rice used in those countries.

My favorite example is that they don't include basic staple food from Japan no miso no beans paste no red beans, etc...

The same container of Miso that in Japan is ¥300 is over ¥1,500 in parts of Canada, more in Europe. Beef broth may be cheap in the west but try finding Japanese Fish Dashi at a reasonable price.

Cabbage is cheaper in North America and Europe but Hakusai is way way more expensive.

So when reading these articles by foreign Press take what they say with a big grain of salt.

The problems may be "linked" to the war, but the direct causes are the financial penalties, oil embargo, etc .. placed on Russia

Inflation didn’t start with Putin’s war. It only exacerbated the problem, which we’ve been talking about since the times when people were saying the coronavirus inflation would prove to be transitory.

It will be bad news indeed if people are led to believe that inflation is all Putin’s fault, because it isn’t, and the problem is serious like 70’s inflation issues were.

I can never get over how cheap most things are in Japan as compared to Australia!

Aus minimum hourly wage is just over $20 AUD (¥ 1,764).

Minimum wage in Japan is Around ¥930 a little more in major cities like Tokyo and Osaka.

When the guy in the 7-eleven is getting ¥1,764 an hour to stock the shelves you are going to pay more than when the guy is getting ¥1,000 an hour.

Here is a very simple example of how the present embargo on Russian goods can affect far more than you may think.

No I will not use oil far to easy.

I will use softwood!

(For those that don't understand , pin Spruce, etc...) These cheap woods are used in everything from your cheap IKEA furniture to the walls of your homes and the construction of buildings, power plants, roads, etc...

As of 2018 Russia became the top suppliers of this material surpassing Canada.

Russia accounts for 23% of the world supply, cut that off suddenly as we just did and watch everything from the cost of a new home to the cost of a new hospital go over budget and fall behind schedule.

We just came out of a wood supply shortage and extremely high wood prices now we are heading right back in and even higher prices are predicted.

So the new kitchen you wanted, the needed repairs to the bathroom or children's room, you had better add on a 20~30% to the cost as a contingency plan.

In my work I need used recycled wood, just looked today up 20% from last month because new wood in short supply already.

Don’t you love when they say there is no inflation after exempting everything you actually need?

except for food, transportation, rent and drug prices, no inflation at all!

those little snacks were the same price as 1979!

Price rises are one thing the global food crisis will be a bigger problem and like the economic problems it is coming and going to grow.

I do like the: "linked"

But pandemic recovery demand, as well as a surge in oil and other commodities linked to the Ukraine war, may finally be achieving what the Bank of Japan couldn't.

The problems may be "linked" to the war, but the direct causes are the financial penalties, oil embargo, etc .. placed on Russia. If people thought it was going to only hurt Russia, well welcome to reality, all those sanctions, embargoes etc ..are what are directly causing the economy issues and the problems.

So saying " linked" is at least accurate!

I notice neither of you who criticized me….bothered to explain it.

Blacklabel

Today 10:43 am JST

At the same time that Japan price level starts rising then yen also dives to a 6 year low against the dollar to prevent cheaper imports.

almost like it’s planned that way

You really should stop watch movies or have more deeper knowledge about economics. Without proper knowledge everything you cannot explain may look like conspiracy for you.

almost like it’s planned that way.

Ohh, a conspiracy! Sounds salacious!

At the same time that Japan price level starts rising then yen also dives to a 6 year low against the dollar to prevent cheaper imports.

almost like it’s planned that way.

It only took 30 years for inflation to kick in.

The shrinkflation has a puncture and the hope for revenge consumption a pipe dream.

Just keep forcing everyone to pay more whilst keeping out foreigners isn't the answer.

With Japan's current resources issues with Russia and China Japan's not likely to be the world's third largest economy for much longer.

Singapore would be a good role model for Japan.

Rising prices but salaries remain stagnant. Tsk...

Swings and roundabouts I suppose. In Australia cost of living and inflation are through the roof while at the same time my house price has doubled in the last 5 years! Hard to find real-estate prices in Japan that increase at that level! I can never get over how cheap most things are in Japan as compared to Australia!

The core problem is that Japan's employers are such cheapskates they won't raise wages to meet the price rises. They scream about a chronic labor shortage, yet don't compete with rivals during hiring season by offering applicants better financial incentives. Crazy.

Just wait Japan……….. The UK is going through the worst cost of living crunch in more than 20 years, fuelled by Covid, the global depression and the war in Ukraine. Wages and pensions have stayed the same, energy bills have doubled, food prices up, National Insurance going up in April.

Don't think that might have tiny bit to do with Brexit?

Luddite, sadly true, and the driving forces of all you detail are international and out of any nations control they will to greater or lesser extent impact on Japan. Inflation is becoming a reality world wide despite what central banks have sought to persuade the public.

Just wait Japan……….. The UK is going through the worst cost of living crunch in more than 20 years, fuelled by Covid, the global depression and the war in Ukraine. Wages and pensions have stayed the same, energy bills have doubled, food prices up, National Insurance going up in April.

Your turn soon.

a two-percent inflation target, seen as key to boosting prosperity

Changing the value of money like that is not actually core to achieving greater prosperity… funny the things some people will believe.

This is inflation driven by shortage, and not inflation driven by growth and demand.

You don’t think all the coronavirus stimulus packages enacted by governments has anything to do with it?

My living expenses have increased up to 20%. COVID now war. Just waiting for sales tax to go up to 15%.

One key to achieving longer-lasting price rises is wage increases.

‘Giving the peasant more is talked about, but apparently an unachievable goal. And they are happy, rolling around in mud. Just look at them so cute. Think it’s a good time to raise the fuel tax, watch them squirm, so funny. Said the Finance minister! It’s a joke or is it?

The prices of goods will increase yet salaries will stay the same or even be cut and in the rare case when it raises it will go up by 1500-3500 yen a month. The company execs will pat themselves on the back and then look for a new second house to buy in Karuizawa or Shizuoka.

The central bank has tried an array of policies including pushing interest rates to rock-bottom to encourage spending and reach a two-percent inflation target, seen as key to boosting prosperity in the world's third-largest economy.

Yet Japanese households refuse to spend no matter how much we encourage inflation and devalue the yen!

What a stubborn conundrum for the eminently titled economists at the central bank. Where do the majority derive the income to spend and what could be interfering with that capital flow?

That might want to consult with Keidanren about this riddle.

Japan's prices are rising, but will it last?

Will it go back to previous price? Once it rise, it will stay same or higher.

"People believe that wages and prices will not grow," and so companies fear losing ground to competitors if they price items higher, he explained.

So they'll keep the price low by cutting corner, waiting to another scandal.

not including volatile fresh food,

there's the rub.....