Japanese CPI Rose More Than Estimates

The video discusses Japan's economic indicators, highlighting a 0.1% rise in core CPI, the lowest jobless rate in 23 years, and a high job-to-applicant ratio. Despite these positive signs, household spending has declined for 12 months, indicating a deflationary mindset. The BOJ is cautious, with discussions on potential rate hikes amid improving CPI data. Wage growth remains weak, challenging the creation of a 'virtuous circle' of rising wages and prices.

Analyze the significance of the household spending decline of 1.2% year on year.

What challenges does the BOJ face in changing the deflationary mindset among consumers?