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Japan Inflation

Japan Inflation

Inflation in Japan

Japan generally experienced low inflation from 2013 to 2022, often below 1% and even slipping into negative territory, despite the Bank of Japan's aggressive monetary easing policies. This trend was attributed to a combination of factors, including an aging population, stagnant wage growth, and a culture of price sensitivity among consumers. However, the aftermath of the COVID-19 pandemic has seen inflation rise to multi-decade highs, raising hopes that Japan may be breaking free of its past trend of persistently low price pressures.

Consumer price inflation in Japan averaged 0.8% in the ten years to 2022, below the Major Economies regional average of 2.1%. The 2022 average figure was 2.5%. For more inflation information, visit our dedicated page.

Japan Inflation Chart

Note: This chart displays Inflation Rate (CPI, annual variation in %) for Japan from 2014 to 2023.
Source: Japanese Bureau of Statistics.

Japan Inflation Data

2018 2019 2020 2021 2022
Inflation (CPI, ann. var. %, aop) 1.0 0.5 0.0 -0.2 2.5
Inflation (CPI, ann. var. %, eop) 0.3 0.8 -1.2 0.8 4.0
Inflation (Core, ann. var. %, eop) 0.8 0.8 -1.1 0.6 4.0
Inflation (Core, ann. var. %, aop) 0.9 0.6 -0.2 -0.2 2.3
Inflation (PPI, ann. var. %, aop) 2.6 0.2 -1.2 4.6 9.8

Inflation dips to lowest since July 2022 in November

Inflation came in at 2.8% in November, which was down from October’s 3.3%. November's figure marked the lowest inflation rate since July 2022, and reflected a sharper fall in food plus electricity and gas prices. Meanwhile, services prices rose at the sharpest pace since October 1993, suggesting that the Bank of Japan’s push to boost wages via its ultra-low interest rates is working. In addition, the trend pointed down mildly, with annual average inflation coming in at 3.4% in November (October: 3.5%). Meanwhile, core inflation—which excludes volatile fresh food prices—fell to 2.5% in November, from October’s 2.9%, and was in line with market expectations. Finally, consumer prices fell 0.22% from the previous month in November, swinging from October's 0.85% increase. November's result marked the weakest reading since February.

Our panelists expect inflation to continue to decline ahead, falling below the Bank of Japan’s 2.0% target in Q4 2024 on a higher base effect, lower food prices, and a stronger yen. Commodity prices are a key factor to watch.

Consensus Forecasts and Projections for the next ten years

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Japanese inflation projections for the next ten years from a panel of 48 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable inflation forecast available for Japanese inflation.

Download one of our sample reports to visualize what a Consensus Forecast is and see our Japanese inflation projections.

Want to get access to the full dataset of Japanese inflation forecasts? Send an email to info@focus-economics.com.

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