Against all odds, the third largest economy officially falls into recession. GDP has declined again in the third quarter: -0.4%.
Yet most experts forecast a growth of 0.5%.
The economy minister, Akira Amari, is cautious and confident: "Before taking the decision to raise taxes, to check that it does not slow down the recovery. The most important is not to return deflation. "
Combat the specter of deflation: the priority of Prime Minister Shinzo Abe, who should ultimately defer its proposed increase in VAT.
A tax already increased from 5 to 8% last spring. Immediate result: consumption plummeting and political compromise recovery.
To continue these reforms and stabilize its government, Shinzo Abe should call early elections next month ...
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