Japan: Inflation continues to decline in December
January 27, 2012
In December, the core consumer price index, which excludes volatile fresh food prices, remained flat in seasonally adjusted terms over the previous month, which mirrored November's result. Annual core inflation remained in negative territory for the third consecutive month at minus 0.1% which was, nevertheless, slightly up from the minus 0.2% seen in November and in line with market expectations. Meanwhile, annual overall inflation stepped up to minus 0.2% in December, up from the minus 0.5% recorded in November. Overall, in 2011 Japan continued to suffer deflation for the third consecutive year, with annual average inflation at minus 0.3% (2010: -0.7% year-on-year). Core consumer prices in Tokyo, which are available one month before the nationwide figures, dropped 0.4% in January over the same month last year, after falling 0.3% in December, confirming that consumer prices remain on a downward trend.