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“We will have to call for a sales tax hike in the future given Japan cannot avoid a decline in population,” Japanese Chief Secretary and front-runner for the country’s leadership race Yoshihide Suga said on Thursday, as reported by Reuters.

“We want to bring Japan’s economy back to pre-pandemic levels about a year from now,” Suga added. “Economic activity is starting to resume thanks to government payouts and loans.”

Market reaction

The USD/JPY pair showed no significant reaction to these comments and was last seen trading flat on the day at 106.16.