Predicting growing demand for 5 yen coins, the Bank of Japan has minted some 400 million of the ring-shaped coins and stockpiled them at its branches. The amount is three to four times the conventional reserves.
The move is in line with the consumption tax increase to 5 percent Mar. 31. When the 3 percent tax was introduced on April 1, 1989, 1 yen coins were suddenly in great demand. Many grocery items that now sell for 103 yen will cost 105 yen, and consumers are expected to find more 5 yen coins in their pockets.
Even 100 yen chewing gum, candies and other goods sold at rail kiosks will cost 105 yen. The kiosks did not raise these prices in 1989, saying using 1 yen coins as change would delay busy train passengers.
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