Speech Overview
Bank of Japan Executive Director Junko Nakagawa delivered a speech on "Japan's Economic and Price Situation and Monetary Policy" at the Yamaguchi Financial and Economic Roundtable on August 28, 2025.
Overseas Economic Conditions
According to IMF growth projections for each country and region, growth rates are expected to slow to the latter half of 2% in 2025, but recover to around 3% in 2026.
Domestic Economic Situation
Current Assessment: Although some areas show weak movements, the economy is recovering gradually
Corporate Sector Trends:
- Current profits in Financial Statements Statistics of Corporations by Industry: +3.8% year-on-year increase (maintaining high levels comparable to historical peaks)
- Manufacturing: -4.2% year-on-year decrease, but maintaining high levels due to recovery in AI-centered IT-related demand
- Non-manufacturing: +7.1% significant increase
Employment and Wage Conditions:
- Wage increase rate in spring labor-management negotiations: +5.3% for regular employees (high level)
- Small and medium-sized enterprises also recorded +4.4%
Price Trends
- Consumer prices (excluding fresh food): Declined to around 3% year-on-year
- Excluding fresh food and energy basis: +2.9% with slightly expanded positive margin
Monetary Policy Management Direction
Continuing appropriate policy management while thoroughly examining economic, price, and financial conditions toward sustainable and stable achievement of the 2% price stability target. Also emphasized the importance of detailed policy responses tailored to Yamaguchi Prefecture's actual circumstances.