What is the name of the national debt in Japanese

Japanese budget: national debt and other trifles

In Japan, the Bank of Japan (BoJ) is still waiting for prices to recover. In January, the inflation rate rose by 0.8 percent year-on-year, according to experts already calculated after the weak December data. The rise in the core rate had slowed in December - due to falling raw material prices - for the first time since April (0.7 percent).

Despite the slight recovery at the start of the year, the inflation rate is well below the central bank's two percent target. Japan tried for years to adjust inflation with a loose monetary policy. At the same time, the Japanese central bank is trying to counter the ever-falling prices. Consumer hopes for cheaper prices are also damaging the economy.

In the meantime, the schedule for the two percent target has been abandoned. Rather, central bank chief Haruhiko Kuroda even lowered the inflation forecast for the current and coming fiscal year. Falling prices, falling wages and sluggish investments have been paralyzing the country for a long time. Bad numbers from the central bank act like another nail in the coffin.

Willingness to invest top, growth prospects flop

Another negative effect: due to the ongoing low interest rate policy, business with corporate bonds with questionable credit ratings has increased significantly. Companies can borrow or borrow money at ridiculous rates. Even companies that couldn't do that before. Namely, those that are rated "BBB" by rating agencies and can keep the "investment grade" level by a pinch.

The BoJ wants to consider a further easing of monetary policy. This could mean that new steps should also be checked for side effects and side effects. For example, financial institutions have been suffering from the zero interest rate policy for years. Central bank chief Kuroda repeated possible easing instruments of the BoJ could be the lowering of the short and long-term interest rates, an expanded purchase of assets or the switching on of the money printing machine.

Japanese national debt is currently around 250 percent of gross domestic product. From a purely economic point of view, the Japanese economy should have long since fallen victim to hyperinflation. At least if it goes according to the widely accepted law of economists Carmen Reinhart and Kenneth Rogoff. This says: If the national debt exceeds 90 percent of GDP, collapse is near.