Japan’s economy grew an annualised 2.7% in Q1 2023, according to Reuters, following the removal of pandemic-related restrictions and a gain in confidence amongst businesses. According to the Bank of Japan’s latest short-term survey of Japanese businesses, the headline index measuring large manufacturers’ mood rose to plus 5 in June – the highest since December 2022 – whilst the non-manufacturers’ sentiment index, increasing for the fifth-consecutive quarter, soared to plus 23 – the highest since June 2019. Conversely, as the number of dual-earner households rises, businesses are cashing in on the double benefit of the country’s high disposable income and pent-up consumer demand. In 2021, the average monthly disposable income of Japanese workers’ householders was JPY 492.7 thousand, according to Statista, the second-highest in the past decade, after a record near JPY 499 thousand in 2020.
With private consumption accounting for over half of Japan’s economy, the removal of pandemic-related restrictions has reawakened
