Major issues characterizing the Japanese economy range from the national bank's drive for a thus far elusive 2 percent inflation rate to its slow but steady pace of gross domestic product growth. While the brief 0.6 percent contraction seen during 2018's first quarter stemmed in part from private consumption that had gone static, Japan's consumer spending is lately fueled in no small share by an unexpected source: wealthy grandparents doting on their grandchildren.
According to Bloomberg, the Japanese households exhibiting the most robust spending were those with elderly residents who'd saved money responsibly for years and could now spend freely on their children and grandchildren. This trend, which took off in earnest back in 2016's third quarter when consumption started rising across the board, has since accounted for $87 billion - 9.7 trillion yen - each year.
Mikayo Taguchi, a 60-year-old grandmother living in Miyazaki prefecture, emphasized the importance of savings when treating their grandchildren and children, in an interview with the news provider.
"Those who are grandmothers and grandfathers often say that you can't look after your grandchildren unless you have money," Taguchi told Bloomberg.
Steady consumer spending from this and other demographics may help offset the deflation that has many Japanese economists worried. Reuters reported that leaders at the Bank of Japan are still in favor of easing policies as well as encouraging widespread wage increases while inflation targets remain out of reach.