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Abe & the Consumption Tax: No Nineties Throwback

Chris Scicluna

• Shinzo Abe looks set soon to give the green light to April’s consumption tax hike.
• That has raised fears of a repeat of 1997, when a similar measure coincided with Japan’s slide into deflation.
• But conditions are now very different to 1997 and we think such fears are overdone.

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A Tale of Two Cities

During twenty-plus years of economic underperformance, policymaking in Japan earned itself a (largely deserved) reputation for both its caution and its incompetence. Japan became an object-lesson in how not to run an economy...

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QQE in action: The BoJ's flow of funds data

The BoJ’s massive easing of monetary policy announced in early April, via a commitment to double the monetary base and more than double its holdings of JGBs within two years, is in part designed to change the asset allocation strategies of Japanese investors...

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Did the Fed bottle it?

The Fed’s decision last night not to start its tapering process, in spite of almost universal expectations fuelled by the Fed itself that it would, has been both welcomed by financial markets, which have rallied hard in its aftermath, and characterised as the...

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Abe & the Consumption Tax: No Nineties Throwback

Shinzo Abe will shortly reach a defining moment of his second premiership with the announcement on whether to raise the consumption tax next April. Reports suggest that, encouraged in part by the upward revision to Q2 GDP...

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