Home Finance Japan’s burden under inflation, Fumio Kishida’s next move

Japan’s burden under inflation, Fumio Kishida’s next move

Prime Minister Fumio Kishida’s policy received lashings recently when opposition parties corner it as retaliation against sudden price hikes. The country’s cost of living is steadily climbing and becoming a politically sensitive issue, taking the course alongside this weekend’s upper house election that many eyes are keen on monitoring.

Kishida’s ruling alliance is forecasted to slice a majority for certain. However, the citizens being miffed about the inflation may deter his party’s crowning process as it set him against the economic policies his predecessors saw through.

Kishida had entered the office in October, and his fame of being dependable has stumbled ever since the hiking rates came into clear view. There has been a cumulative idea of those who ally with him being at 54%, a definite downslide from the 59% three weeks prior according to NHK, a public broadcaster who ran a poll to garner these results.

Some even went as far as siding with the opposition party for the first time since forever, one such person is Fuka Sato, a woman in her late twenties working at a magazine agency.

She had commented on feeling insecure about the future—this is something note-worthy considering how consumers are afraid to buy food and essentials since they are overpriced and frivolous.

Furthermore, for the first time in nearly a decade, Japan’s consumer inflation ominously passed the ideal 2% target set by the Bank of Japan. This is mostly thanks to surging commodity demand and rates, forced afront by the situation of Ukraine being invaded by Russia.

As a major side effect, many households, businesses of restaurants and grocery stores, and even schools have resorted to minimizing their budget and allowance for food items just to deal with the circumstances.

The inflation rate, when put against a global scale, is still humble—but nonetheless, the current generation of consumers had not seen growing inflation in decades and would likely not experience wages being lifted to be equivalent to the surging cost of living.

Meanwhile, it isn’t probable that the upper house elections might be quick in affecting policy, but that doesn’t mean Kishida’s show this weekend wouldn’t be beneficial to help get on the public’s good side.

Former PM Shinzo Abe, who was a part of a much grander faction, is a formidable opponent for Kishida, who hailed from a much less influential LDP faction. Because of this background, he requires the capital upper house profited to claim a tight hold on his spot.

At the present moment though, there won’t be too big of a change since it is the safest route for Kishida to balance present policies alongside the established and long-term Abenomics, set by the former PM who emphasized government spending leisurely to make Japan a competitive economy, tacked on with incredibly low-interest rates.

Regardless, once he has staked a claim on his position and found a proper anchor in the public’s trust, Kishida would likely separate his policies from the ironclad Abenomics approach.

Yuri Okina, the chairwoman of Japan Research Institute, had commented that presumably the focus of the post-election period for Kishida should be to carry Japan into a near pre-pandemic state, and this is achievable by digitalization and much more leniency and benefits for workers suffering under the current circumstances.

She also added that the economic health isn’t at its best, courtesy of the yen still struggling and packed together with the looming inflation is a tough nut to crack for Japan.

This turn of events is adversely impacting everyone.

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