Do You Know the Truth of Inflation in Japan?


Tragedy will attack Japanese school kids

Are bananas categorized as snacks for a trip? I ensure this phrase never fails to make Japanese people laugh. Japanese elementary school students (6 to 12 years old) go on a school day trip once or twice a year. It’s fun and special to go to a zoo or a park together with classmates, but equally or more important is they are allowed to bring snacks.

The problem is the total amount is limited to less than only 300 yen (about 2.6 US dollars at the current exchange rate) in most schools. Kids always beat their brains to maximize the benefits arising from such a limited amount of snacks. This is the reason why bananas are subject to debate as above (as a joke) in Japan.

Snack price will be inflated, but the kid’s allowance won’t

You may think you can’t buy anything only with 300 yen, but don’t make light of Japan. It’s a country suffering from deflation for more than 20 years. We have a wide variety of snacks selling at only 10 yen (about 9 US cents) each, but lately there have been news reporting the price increase of such 10-yen snacks due to the current worldwide inflation. Kids are losing their last Paradise. You may also think it’s no problem because the snack limit will be inflated as well, but it’s not going to happen, I’m afraid. Indeed, CPI (Consumer Price Index) is finally rising even in this deflation country, but the core-core CPI (excluding fresh foods and energy) is still going down.

Wooden dining chairs lined up along the counter table of a classy Japanese restaurant.
Korento Chair Series by Mikko Halonen

This is a nightmare inflation (cost-push inflation). The dependency on petroleum of Japan is still more than 80%, and we’re dependent 99% on foreign oil. Wages don’t increase, but commodity prices are increasing due to the current rise in crude oil prices. In such a tough situation, we kept on struggling to keep the current price of our furniture, but finally, we’ve been cornered to make a price hike. Apparently, there is still some time before the price increase. Please don’t miss the last chance!


Photo Credit: https://www.japantimes.co.jp/life/2021/02/06/food/dagashiya-sweets-in-decline/


Shungo Ijima

He is travelling around the world. His passion is to explain Japan to the world, from the unique viewpoint accumulated through his career: overseas posting, MBA holder, former official of the Ministry of Finance.