TOKYO – Even before Donald Trump’s return to the White House, Japan is experiencing something of an economic reckoning that government officials seem to be missing.
In at least four of the last five months of the year, Japan’s household spending fell. “At least” is used here because the December figures aren’t yet known. In November, real spending dropped 0.4% year on year. There’s little reason to think things rebounded in the last 30 days of 2025.
The point is that the “virtuous cycle” Prime Minister Shigeru Ishiba’s Liberal Democratic Party (LDP) has promised since 2012 still hasn’t arrived. That’s despite all the champagne cork-popping last Spring when labor unions scored their biggest raise in 33 years.
