Economics

Inflation Gains Footing in Japan

  • Demand pressures rising after reliance on external conditions
  • Lower energy prices, stronger yen could still halt progress

The Japanese national flag flies outside the Bank of Japan headquarters in Tokyo, Japan.

Photographer: Kiyoshi Ota/Bloomberg

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Inflation is showing signs of taking root in Japan.

With price gains halfway to the Bank of Japan’s 2 percent target, domestic demand is picking up after years in which external factors such as energy prices did most of the work.