Japan's 2026 Economy: Boom for Stocks, Squeeze for Households

Japan's economy enters 2026 pulled in opposite directions. A booming stock market contrasts with persistent inflation and a growing gap between corporate profits and household finances. NHK Deputy Chief Commentator Iida Kaori analyzes the key forces shaping the year. The critical issue is whether wage growth will finally outpace rising prices. This will determine consumer spending power. The Bank of Japan's interest rate policy remains a major focus. Further rate hikes could slow inflation but also risk stifling economic growth. Global uncertainties, from trade tensions to regional conflicts, add another layer of risk. In summary, 2026 presents a complex picture. Corporate and market strength coexists with significant pressure on everyday living costs. *This analysis is based on a segment originally aired on NHK NEWSLINE on January 7.*