Japan’s economy and currency fell slightly more than expected in 2023, making it the world’s fourth-largest economy after Germany.
According to current projections, India will overtake both countries to become the third largest economy after the United States and China by 2030.
Barons on wednesday Quote Analysts said the big problem for Japan was the “rapid depreciation of the yen against the dollar.” Japan’s economy grew by 1.9% in 2023, while Germany’s economy contracted by 0.3%, while the yen plunged 20% against the dollar over the past two years.
While the weaker yen may have helped Japan with some key exports such as automobiles, Japan’s total GDP was $4.2 trillion, dropping it from third place in the world rankings behind Germany’s $4.5 trillion. .
Germany and Japan both suffer from labor shortages due to demographic collapse, but Japan’s birth rate problem is even more serious, and analysts believe Germany’s pro-business policies are better able to maintain output. He said that
Japanese bank officials said Wednesday warned He opposed the “rapid movement” of currency speculation that was damaging the national economy.
“Recent currency movements have been fast. The yen has depreciated by nearly 10 yen in about a month, and such rapid movements are not good for the economy,” said Masato Kanda, Japan’s deputy finance minister for international affairs. .
Mr. Kanda was vague about whether the government would intervene to protect the value of the yen, but Finance Minister Shunichi Suzuki left the press conference without saying anything when asked the same question.
Japan’s economy may have lost its status as the third-largest economy, a depressing conclusion to 1980s predictions that it would soon become the world’s dominant economic force, but as a consolation, Japan’s stock market He’s doing great right now.
The weak yen is a contributing factor to the boom in Japan’s stock market, along with the rapid rise in profits of Japanese companies as the Tokyo Stock Exchange reforms and companies take steps to increase shareholder returns. China’s economic crisis is also prompting investors to seek alternative Asian markets.
Al Jazeera News report Last week, it was announced that the Tokyo market’s benchmark index rose 28%, all but erasing the memory of the 1990s market bubble and subsequent decades of market stagnation. The Nikkei 225 index rose 8% in January as foreign investors bought $6.5 billion worth of Japanese stocks in just one week.
In Japan, it is clear that deflation is over, wages are rising, and Prime Minister Fumio Kishida’s government is cautious about encouraging investment rather than savings.
The recent stock market news has been so good that Japan is in a crash. recession The second half of 2023 surprised many analysts. Some of these analysts expect the upward revision to return to moderate positive growth in the final quarter of 2023, and if a significant portion of the yen’s value recovers, concerns about an economic recession should be dispelled.
On the other hand, India’s GDP is Be expected It is expected to reach $5 trillion within the next three years and $7 trillion by 2030, easily overtaking Germany to become the world’s third largest economy. India was ranked 5th at the end of 2023.
India’s finance ministry acknowledged in January that the country’s high GDP growth was due to strong domestic demand, which could reach 7% next fiscal year. The ministry said business-friendly reforms and infrastructure improvements would be included in the policy mix to support economic growth of $7 trillion by 2030.
