Japan Inflation

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Japan: Core inflation falls to seven-month low in October

November 28, 2014

In October, the core consumer price index, which excludes volatile fresh food prices, rose 0.1% over the previous month. The print, which was a notch above the flat reading observed in September, mainly reflected higher prices for clothes and footwear as well as for culture and recreation.

Annual core inflation inched down from the previous month’s 3.0% to 2.9% in October. The print was in line with market expectations and represented the lowest rate since March of this year. Overall inflation declined from 3.2% in September to 2.9% in October.

Core inflation for Tokyo—available one month in advance of the national figures and thus a leading indicator for countrywide inflation—inched down from 2.5% in October to 2.4% in November, 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 October 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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