Japan Inflation


Japan: Core inflation continues to ease in September

October 31, 2014

In September, the core consumer price index, which excludes volatile fresh food prices, was flat over the previous month. The print, which matched the result observed in August, mainly reflected that lower prices for culture and recreation, transportation, and fuel, light and water charges were offset by higher prices in most of the remaining sub-categories.

Annual core inflation inched down from the previous month’s 3.1% to 3.0% in September. The print was in line with market expectations and represented the lowest rate since March. Overall inflation ticked down from 3.3% in August to 3.2% in September.

Core inflation for Tokyo—available one month in advance of the national figures and thus a leading indicator for countrywide inflation—inched down from 2.6% in September to 2.5% in October, which matched the result that market analysts had expected.

The Bank of Japan (BoJ) expects that core inflation will be between 3.1% and 3.4% in the fiscal year ending March 2015. In the following fiscal year, the BoJ sees inflation falling to somewhere between 1.8% and 2.6%. FocusEconomics Consensus Forecast panelists expect inflation of 2.8% in the calendar year 2014, which is up 0.1 percentage points from last month’s estimate. In 2015, the panel sees inflation at 1.8%, which is unchanged from last month’s projection.

Author: Ricard Torné, Lead Economist

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Japan Inflation Chart

Japan Inflation September 2014

Note: Year-on-year and month-on-month var. of consumer price index in %.
Source: Statistics Bureau (SB) and FocusEconomics calculations.

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