J. Safra Sarasin economist Louis Chua said Japan plans to cut the food
consumption tax from 8% to 1% effective April 2027, a move by Sanae Takaichi’s
government to allay mounting cost-of-living concerns that have weakened public
confidence in inflation management. Chua expects retailers—especially
supermarket operators, discount chains and food-focused drugstores—and
restaurants with pricing power to be primary beneficiaries. The bank added that
increased market volatility could, in the short term, accelerate flows out of
technology into defensive and domestic-demand-focused stocks.
