Asia's cautious acceptance of Japan's "Abenomics" economic stimulus is based largely on the bet that it will stimulate enough domestic demand to outweigh the risk of inflation, asset bubbles and the challenge posed by a falling yen. "If Japan comes out of deflation and if the broader agenda of Abenomics is successful, raising the potential growth rate, restoring more animal spirits to the Japanese economy, that's good. It's good for Japan, it's good for the region and it's good for the world," said Paul Sheard, chief global economist at Standard and Poor's.

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