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Japan Economy Reaches "Inflection Point": Fitch Official

Japan Economy Reaches "Inflection Point": Fitch Official

   New York, April 2 (Jiji Press)--The Japanese economy may have reached an "inflection point" leading to a positive cycle of wage increases and steady inflation, James McCormack, head of sovereign ratings at Fitch Ratings, told Jiji Press in a recent interview.
   "It's quite possible that Japan has reached what we would call an inflection point where dynamics of inflation and inflation expectations have changed," McCormack said.
   He said the Bank of Japan is expected to raise short-term interest rates to 0.25 pct by the end of next year, forecasting "very slow, very gradual" increases.
   The Japanese central bank last month ended its negative interest rate policy and raised short-term rates to zero to 0.1 pct, its first rate increase in 17 years.
   "Wage growth should support consumption going forward and should support...economic growth," McCormack said. Household and corporate balance sheets "look reasonably strong and capable of absorbing the change," he said, referring to the increase in interest rates.

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AFP-JIJI PRESS NEWS JOURNAL


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