JAPAN | Part 6 | Economy

Japan's economy reached a turning point in 2006 after it had become the world's first major industrial power since the 1930's to suffer deflation (falling prices). From 1997 to 2004, Japan's domestic output fell by 5 percent. In 2006, it showed signs of recovery. By May, unemployment rates had fallen to 4 percent, the lowest since 1998. On July 14, 2006, Japan's central bank raised its interest rate, which had been at zero for more than six years, to 0.25 percent. --- JAPAN | Part 6 | Economy Japan's economy reached a turning point in 2006 after it had become the world's first major industrial power since the 1930's to suffer deflation (falling prices). From 1997 to 2004, Japan's domestic output fell by 5 percent. In 2006, it showed signs of recovery. By May, unemployment rates had fallen to 4 percent, the lowest since 1998. On July 14, 2006, Japan's central bank raised its interest rate, which had been at zero for more than six years, to 0.25 percent.