Impact on economic activity from political uncertainty and policy shifts

「On the other hand, prices continue to rise against a backdrop of the unstable international situation, and the economic outlook remains uncertain.」

「On the other hand, there are many uncertainties, including surging raw material prices, the resulting price increases and the impact of higher US tariffs, and the economic outlook remains uncertain.」

「During the consolidated fiscal year under review, Japan's economy continued to recover and inbound demand remained strong. On the other hand, prices of various goods and services, including daily necessities, continued to rise, and personal consumption showed signs of stalling. In addition, the unstable international situation, including policy developments under the new US administration, continued, and the outlook remained uncertain.」

「At the same time, the unstable international situation has continued, and the effects of the prolonged depreciation of the yen and surging energy procurement costs, including higher prices, have also persisted, leaving the outlook uncertain.」

「During the cumulative third quarter under review, Japan's economy remained in an uncertain outlook, with resource and commodity prices rising, including fuel prices driven by the situation in Russia and Ukraine, alongside the sharp depreciation of the yen.」

「Meanwhile, as the prolonged situation between Russia and Ukraine continued to affect the global economy, domestic consumption remained challenging amid rising commodity prices, including sharply higher fuel prices, and the rapid depreciation of the yen.」

「In addition, amid the impact of the situation in Russia and Ukraine on the global economy, fuel prices and other commodity prices, led by surging fuel prices, continue to rise, leaving domestic consumer activity in a persistently difficult situation.」

「In addition, as economic uncertainty increased due to the situation between Russia and Ukraine, sharply higher crude oil and commodity prices affected personal consumption, and domestic consumption remained challenging.」

「In addition, personal consumption has been weakening due to the consumption tax increase and repeated typhoon damage, while the economy continues to show increasing signs of slowing.」

「However, concerns remain about the impact of repeated typhoon damage and the consumption tax increase, among other factors, on personal consumption and corporate activity.」

「In the global economy, concerns are growing about intensifying trade friction between China and the United States as growth in emerging economies slows, while uncertainty about the outlook is increasing as the United Kingdom’s EU withdrawal issue becomes prolonged.」

「In overseas economies, China’s economic slowdown, intensifying trade friction between China and the United States, and the issue of the United Kingdom’s withdrawal from the EU have emerged as factors that could worsen the global economy. There are concerns about the impact on Japan’s economy, which is highly dependent on exports.」

「However, with an increase in the consumption tax confirmed, there are concerns that the economy will slow as personal consumption declines.」

「However, as the United States makes its protectionist stance more pronounced, concerns remain about the impact on exports. In addition, increases in the tax burden that are expected to affect personal consumption have been decided, and the situation remains unpredictable.」

「In the global economy, uncertainty in world trade and financial markets is increasing as the United States makes its protectionist stance more pronounced. In addition, regional risks in the Middle East and Northeast Asia remain unresolved, while confrontation stemming from the former Cold War divide between East and West is becoming more pronounced. There are concerns about the impact of these factors slowing the global economy on Japan’s economy, which is highly dependent on exports.」

「However, ahead of the House of Representatives election, there are concerns about the impact of political volatility and associated policy shifts on economic activity going forward.」