Japan's Economy and Monetary Policy Regime Changes since the 1990s Over the past three decades, Japan's economy has experienced major economic fluctuations and prolonged economic stagnation. In the early 1990s, Japan experienced the bursting of the domestic asset bubble, followed by the Asian Financial Crisis of 1997, which occurred outside of Japan but coincided with a crisis in Japan's financial system.
The result of these shocks was a prolonged period of economic stagnation. Economic stagnation  4  accompanied by deflation continued thereafter. However, after the strengthening of monetary easing in 2013, the economy started to recover at a moderate pace and improved to the point where it was no longer experiencing deflation.