Price Increases Driven by the Situations in Ukraine, Resource Prices and Yen Depreciation

「During the interim consolidated accounting period, Japan's economy maintained a gradual recovery trend overall, supported by improvements in employment and income conditions, continued wage increases by companies, a recovery in inbound demand and increased capital investment, including IT investment. However, factors exerting downward pressure on the economy have increased, including uncertainty over the outlook for U.S. trade policy, tensions in Japan-China relations over Taiwan, and rising crude oil prices associated with concerns about escalating and prolonged tensions in the Middle East.」

「Inflation has continued due to persistently high resource and energy prices and rising import costs resulting from prolonged yen depreciation, while real wages have also declined. Accordingly, the outlook for the domestic economy remains uncertain.」

「The outlook for the domestic economy remains uncertain due to persistently high resource and energy prices, continued price increases and rising import costs resulting from yen depreciation. In addition, overseas risks include concerns about the impact of U.S. trade policy, developments in the Chinese economy, including the real estate market, and heightened geopolitical risks associated with worsening conditions in the Middle East.」

「Risks of downward pressure on Japan's economy include issues such as rising prices and labor shortages, the impact of volatility in financial and capital markets, heightened geopolitical risks related to developments in the Middle East, concerns about the outlook for the Chinese economy, and a downturn in overseas economies associated with the continuation of high interest rates in the United States and Europe.」

「However, the outlook for the economy remains uncertain due to risks including heightened geopolitical risks from the prolonged Russia-Ukraine situation and developments in the Middle East, a downside in overseas economies caused by global monetary tightening and concerns about the outlook for the Chinese economy, as well as issues such as continued yen depreciation, rising prices and labor shortages.」

「However, the outlook for the economy remains uncertain due to risks including heightened geopolitical risks from the prolonged Russia-Ukraine situation and escalating tensions in the Middle East, a downside in overseas economies caused by global monetary tightening and concerns about the outlook for the Chinese economy, as well as issues such as yen depreciation, rising prices and labor shortages.」

「However, the Japanese economy faces downside risks from weaker overseas economies caused by heightened geopolitical risks, including the prolonged Russia-Ukraine situation and escalating tensions in the Middle East, global monetary tightening, and concerns over China's economic outlook triggered by stagnation in the real estate market. Although price increases resulting from the pass-through of higher raw material and energy costs in the manufacturing sector have begun to level off, the economic outlook remains uncertain, also affected by higher labor costs due to labor shortages across various industries.」

「During the cumulative third-quarter period, Japan's economy continued to experience rising domestic prices due to the prolonged situation in Ukraine, higher resource prices and the impact of yen depreciation」