US vs. Japan CPI since 2008

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For two countries with similar monetary policies driven by the threat of deflation, inflation rates have been pretty divergent in the US and Japan over the past five years.   Since 2008 US CPI has increased by 9% in aggregate, while Japanese CPI has fallen by 1.8% over the same period.  The way you interpret the divergence may depend on how you view the merits of aggressive monetary policy, but at least what’s clear is that the US is not Japan.  The data also begs the question of how much longer ZIRP is justifiable in the US.

Japan vs. US CPI