Japan’s core consumer prices stopped a 12-month consecutive pattern of declines in August, boosted by higher energy costs and the positive impact of the tourism campaign, reflecting BOJ’s efforts to push inflation towards its 2% target.
- Japan’s prices were flat compared with a year earlier due to a series of wars between rising energy costs and lower mobile phone fees, while lodging prices rose to a record 46.6%.
- Weakness in private consumption that accounts for more than 50% of the economy weighed on the core consumer inflation.
- It was the first time since July 2020 that core Japan’s CPI, which excludes fresh food but includes oil prices, rebounded from negative territory.
- Friday’s data signaled a change in the base year for the CPI that gives more weight to mobile charge fees and has led to a slowdown in core consumer inflation.
The core-core inflation index, which excludes food and energy prices and is the same as the core index used in the US, dropped 0.5% in August from a year earlier, marking a fifth straight month of declines.
Nikkei 225 up +2.06%, JPY USD down -0.11%Source: Reuters
