IMF advises Japan on gradual rate hikes and fiscal restraint
IMF advises Japan to gradually raise interest rates as wage growth strengthens. It also urges the government to keep fiscal stimulus targeted to manage debt.
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Xurve View
The International Monetary Fund (IMF) has recommended that Japan gradually increase interest rates while ensuring fiscal stimulus remains targeted. This guidance comes as the nation experiences robust domestic demand and steady wage gains. Krishna Srinivasan, director for the IMF’s Asia Pacific Department, noted during a news conference that economic growth has held up well, supported by positive wage growth and robust pay hikes from annual negotiations.
Our advice to the BOJ is ... to be data dependent and gradually start increasing rates going forward.
