IMF Staff Country Reports

Japan: 2025 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Japan

April 2, 2025

Download PDF More Formats on IMF eLibrary Order a Print Copy
More formats on IMF eLibrary Order a Print Copy

Preview Citation

Format: Chicago

International Monetary Fund. Asia and Pacific Dept "Japan: 2025 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Japan", IMF Staff Country Reports 2025, 082 (2025), accessed May 23, 2025, https://doi.org/10.5089/9798229006811.002

Export Citation

  • ProCite
  • RefWorks
  • Reference Manager
  • BibTex
  • Zotero
  • EndNote

Summary

The 2025 Article IV Consultation highlights that after three decades of near-zero inflation, signs are growing that Japan’s economy is reaching a new equilibrium with inflation sustained at the Bank of Japan’s two percent headline inflation target. However, Japan continues to face challenges, including from its aging population and high public debt. Growth is expected to accelerate in 2025 and converge to its potential of 0.5 percent in the medium term. Policy priorities are to rebuild fiscal buffers, re-anchor inflation expectations, and advance structural reforms to support potential growth. Public debt is high and is expected to rise from 2030, driven by a higher interest bill and expenditure pressures related to spending on health and long-term care for an aging population. The monetary policy stance is appropriately accommodative and should help ensure inflation expectations rise sustainably to the 2-percent inflation target. Advancing structural reforms, including improving labor mobility, would help improve Japan’s allocative efficiency and boost productivity.

Subject: Anti-money laundering and combating the financing of terrorism (AML/CFT), Central bank policy rate, Crime, Financial services, Inflation, Labor, Labor markets, Labor shortages, Prices

Keywords: Anti-money laundering and combating the financing of terrorism (AML/CFT), Article IV consultation discussion, Asia and Pacific, Balance sheet reduction, BOJ's price stability target, Central bank policy rate, FATF follow-up report, Global, Inflation, Inflation expectation, Labor markets, Labor shortages

Publication Details

You May Also Be Interested In...

Impact of International Shocks on North Macedonia and the Western Balkans: Republic of North Macedonia

May 23, 2025

Population Dynamics, Labor Market Integration, and Migration: Republic of North Macedonia

May 21, 2025

West African Economic and Monetary Union: Staff Report on Common Policies for Member Countries-Press Release; Staff Report; and Statement by the Executive Director for the West African Economic and Monetary Union

May 19, 2025

The Rise and Retreat of US Inflation: An Update

May 16, 2025