Japan: 2017 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Japan
IMF Staff Country Reports, July 31, 2017
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- Japan: 2017 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Japan
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Bibliographic details
- Published: July 31, 2017
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484313411.002
Summary and key findings
- Japan’s economy is growing above potential, narrowing the negative output gap.
- The expansion is broader and more balanced than in 2015:
- Private consumption growth turning positive.
- Private investment strengthening on the back of residential investment.
- Labor shortages are evident.
- Wage growth remains weak.
- Inflation is stubbornly low.
- Growth momentum will carry through 2017 but would weaken in 2018 if fiscal support fades as currently scheduled.
- The fiscal stimulus package supports 2017 growth through higher consumption and investment.
- Monetary policy is expected to remain accommodative and facilitate a virtuous cycle between credit and economic growth.
Economic outlook and scenarios
- Short-term (2017): Growth momentum continues, supported by fiscal stimulus and accommodative monetary policy.
- Medium term (2018): Growth would weaken if fiscal support fades as currently scheduled.
Policy implications and emphasis
- Fiscal policy:
- Fiscal stimulus package supports 2017 growth via higher consumption and investment.
- Continued fiscal support appears critical to sustain momentum into 2018.
- Monetary policy:
- Expected to remain accommodative.
- Role in facilitating a virtuous cycle between credit and economic growth is highlighted.
- Labor market and wages:
- Labor shortages pose constraints.
- Weak wage growth limits domestic demand and inflationary pressures.
- Inflation:
- Remains stubbornly low despite growth above potential.
Publication metadata and classification
- Publication title: Japan: 2017 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Japan
- Publication date: July 31, 2017
- Pages: 84
- Volume: 2017
- Issue: 242
- Series: Country Report No. 2017/242
- DOI: https://doi.org/10.5089/9781484313411.002
- Stock No: 1JPNEA2017001
- ISBN: 9781484313411
- ISSN: 1934-7685
- Subject: Income, Inflation, Labor, Labor markets, National accounts, Prices, Wages
- Keywords: Asia and Pacific, consultation, CR, current account norm, exchange arrangement, fiscal policy, Global, Income, Inflation, ISCR, Japan, Japan-EU EPA, Labor markets, market, money market rate, net export, SDR million, social security system, Wages
International Monetary Fund. Japan: 2017 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Japan (July 31, 2017).
Content in this bundle
- Country Report