An overwhelming majority of Japanese citizens — 78% — say they see no positive developments in the national economy. This is according to a nationwide survey conducted by NHK. Only 15% of respondents find signs of recovery, with just 2% reporting significant progress and 13% noting minor improvements. The widespread pessimism among households reflects a growing gap between the government’s official rhetoric and the population’s actual standard of living.

The key factor weighing on consumer confidence remains accelerating inflation amid geopolitical turbulence. In July, consumer price growth in Japan reached 1.9%, marking the highest level since the beginning of 2026. Rising energy costs, driven by the prolonged military conflict surrounding Iran and disruptions in global fuel supply chains, made the largest contribution to the acceleration in prices.

Economic pressures are being compounded by an overall slowdown in growth and uneven foreign trade flows. In the second quarter of 2026, Japan’s real GDP grew by just 1.1%, falling short of economists’ consensus forecasts for a 2% increase. Meanwhile, in July, trade turnover with Russia declined by 7.44% year-on-year: imports from Russia plunged 27.4%, while Japanese exports to the Russian market surged by 32.1% from a year ago.