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The Japanese economy in the fiscal year of 1974 (from April 1974 to March 1975) was in the process of convergence of the abnormal inflation carried over from the previous year. The recession constituted a background for such convergence of the inflation was of the largest after the war, and the transport activities experienced an unprecedented stagnation.
The rise of the oil price due to the oil crisis in the fall of 1973 accelerated
the inflation which had been in progress in the first half of fiscal 1973. As
the result, the domestic final demands such as the individual consumption and
civil investment to housing declined sharply in the January-March term of 1974
to trigger the recession. Further, in and after the July-September term., stock
adjustments were carried out extensively, resulting in the recession of an unprecedented
scale with the real GNP of fiscal 1974 decreased by 0.5 percent against the
previous year (Fig. 1-1-2).
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