Japan: Core inflation falls in December
Core consumer prices—which exclude fresh food—rose 0.10% in December over the previous month, moderating from the 0.30% rise recorded in November.
Core consumer prices rose 0.4% in annual terms in December, easing from November’s 0.5% reading that had marked a 20-month high. As such, the annual average variation of core consumer prices for 2021 as a whole came in at minus 0.2%, matching the fall recorded across 2020. Lastly, consumer price inflation for all items rose to 0.8% in December, from the previous month’s 0.6% reading.
Regarding the outlook, Yuki Takashima and Takashi Miwa, economists at Nomura, commented:
“We expect global inflationary pressures largely from energy and food prices to continue to be reflected in consumer prices in Japan. Our forecasts call for core CPI inflation to rise to around 1.5% yoy in April–June 2022, but we expect the rise to slow again from there, in part on negative contributions from energy prices, and we expect inflation rates in Japan to continue to be lower than those in other countries such as the US.”