Why is inflation so low in Japan?

Japan’s history of low inflation

While other countries are battling to stop inflation soaring, Japan has struggled with low inflation, low growth and deflation for decades.
Between 1960 and the late 1980s, Japan’s economic growth was double that of the US. But in 1989, there was a stock market crash and a banking crisis in Japan. Inflation in Japan has remained low ever since, and turned into deflation in the 2000s, and again during the pandemic.
Inflation has been low in Japan since the 1990s.
The current 3% rate of inflation in Japan is higher than the central bank’s 2% target. But underlying growth in prices – with the spike in energy and food costs stripped out – is still low, Moneycontrol.com says.

Inflation is a global challenge

The energy and food crises have turned inflation into a global phenomenon in 2022, with all advanced economies and 87% of emerging markets and developing countries affected, according to the World Bank.
But not every country is battling rising inflation. In Zambia, a range of measures have helped bring inflation down from more than 24% in August 2021 to 9.7% in June this year.
Inflation is also low in Switzerland, at around 3.5% according to Trading Economics. Wage restraint and an energy mix that reduces Switzerland’s exposure to rising oil and gas prices are among the reasons for this, Reuters reports.
Switzerland generated more than 60% of the electricity it needs from its own hydroelectric plants in 2021, according to data from the US International Trade Administration.