Will Japan's core Consumer Price Index (CPI) remain above 2.5% YoY for 12 consecutive months starting January 2026?

Japan's Inflation: Sustained Above 2.5% in 2026?

For decades, Japan has battled deflation, with the Bank of Japan (BoJ) aiming for 2.0% inflation. While inflation has temporarily spiked above this level, sustaining it is the ultimate measure of success. This prediction asks if the economic forces—primarily wage increases achieved through the 'Shunto' spring labor offensive—will be strong enough to keep prices rising above 2.5% for a full year.

The Wage-Price Spiral

The majority 'Yes' vote indicates confidence that the BoJ's ultra-loose monetary policy, coupled with demographic-driven labor shortages, is finally creating the conditions for a lasting wage-price spiral. If large firms continue to grant significant wage hikes, these costs will be passed to consumers, leading to a permanent break from the deflationary mindset.