As China grapples with persistent deflationary pressure, scholars from one of the country’s top universities have urged the government to take more forceful action to prevent the economy from becoming trapped in a Japan-style downward spiral.
Beijing should adopt a binding inflation target and make reviving price growth a top priority, they argued, pointing to Japan’s “lost decades” as a cautionary tale of how deflation can become deeply entrenched if left unchecked.
“Japan’s experience has…
Source: China must take action to avoid Japan-style deflation spiral, scholars warn
