The Governor of the Japanese Central Bank has called on local companies to raise salaries and increase investment in order to help the country in the fight against deflation. During a meeting in central Japan, Haruhiko Kuroda told a group of automotive and aviation industry leaders that the central bank is committed to the 2% inflation target and that it expects companies to take decisions accordingly.
Kuroda announced in recent weeks an increase in asset purchases to inject trillions of yen into the Japanese economy. In the last quarter the country slipped into recession and this has raised doubts that the work of Prime Minister Shinzo Abe is effective. The profits of Japanese corporate companies took off thanks to the expansionary policy of the Central Bank which weakened the yen, long considered a safe haven currency. However, workers' wages have remained flat or even fallen, while prices have risen.
