Japan Inflation January 2018


Japan: Core inflation unchanged again in January

February 23, 2018

In January, the core consumer price index rose 0.2% compared to the previous month in seasonally-adjusted terms, following December’s 0.1% increase.

Core inflation came in at 0.9% in January, matching the result in the previous two months, which represented the joint-highest reading since March 2015. The print was in line with market analysts’ expectations. Overall inflation increased from 1.0% in December to 1.4% in January, the highest reading in nearly three years.

With oil prices moderating the pace of rise, a government official stated that inflation is, “expected to be flat in the coming months”. Subdued inflation pressures will likely force the Bank of Japan to keep its ultra-loose monetary policy unchanged for the foreseeable future.

Japan Inflation Forecast

The Bank of Japan (BoJ) expects that core inflation will average between 1.3% to 1.6% in the fiscal year ending March 2019. In the following fiscal year, the BoJ sees core inflation rising to between 2.0% and 2.5%. FocusEconomics Consensus Forecast panelists expect inflation of 0.9% in calendar year 2018, which is up 0.1 percentage points from last month’s estimate. In 2019, the panel sees inflation at 1.3%.


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Japan Inflation Chart

Japan Inflation January 2018 0

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

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