Japan: Core inflation inches up in September

The core consumer price index rose 0.1% in month-on-month seasonally-adjusted terms in September, below August’s 0.3% increase.

Core inflation inched up from 0.9% in August to 1.0% in September, exceeding market expectations of a 0.9% rise. Nevertheless, inflation remained well below the Bank of Japan’s inflation target of 2.0%. Overall inflation fell from August’s six-month high of 1.3% in August to 1.2% in September.

Core inflation in the Ku-area of Tokyo—available one month in advance of the national figures and thus a leading indicator for countrywide inflation—rose from 0.9% in August to 1.0% in September. The next data release is scheduled for 26 October.

Japan Inflation Forecast

The median inflation forecast among BoJ members is 1.3% for FY 2018 and 2.3% for FY 2019. Last month, FocusEconomics Consensus Forecast panelists expected inflation of 1.1% in calendar year 2019, which was down 0.1 percentage points from the previous month’s estimate. In 2020, our panelists saw inflation at 1.5%.