logo
Plus   Neg
Share
Email

Japan Core Consumer Prices Rise Most Since 2008

consumer-prices-291113.jpg

Japan's key inflation gauge rose at the fastest pace in five years in October, government data revealed Friday, reinforcing expectations that Prime Minister Shinzo Abe's efforts to exit 15 years of deflation is taking effect.

The core consumer price index, that excludes fresh food, increased 0.9 percent year-on-year in October, marking the fifth straight monthly gain in the index, data from the Statistics Bureau of the Ministry of Internal Affairs and Communications showed. Also, the rate of increase was the highest ever recorded since November 2008.

Abe launched radical policy reforms early this year, pledging to shun deflation and strengthen the economic recovery. Acting in accordance with the 'three arrows' of Abe's policies, often dubbed the 'Abenomics', the Bank of Japan introduced a massive stimulus program in April.

The BoJ aims to achieve 2 percent inflation in two years, though there are disputes both within and outside the central bank regarding the time frame set to attain the target.

The CPI, excluding food and energy, increased 0.3 percent year-on-year in October. This was the first increase in the index since October 2008 and the strongest in 15 years. It showed a flat reading in September.

The core CPI for Tokyo, an early indicator of price trend across the nation, increased 0.6 percent year-on-year in November, the Statistics Bureau said.

Separately, the bureau reported that household spending in Japan rose at a weaker-than-expected pace of 0.9 percent year-on-year in real terms in October. The pace of increase slowed from 3.7 percent in September largely reflecting lower utility costs.

The Statistics Bureau said in a separate report that Japan's unemployment remained at 4 percent in October, unchanged from the previous month. The number of unemployed persons fell 3 percent year-on-year to 263,000.

Industrial production rose at a weaker pace in October, preliminary data from the Ministry of Economy, Trade and Industry showed Friday. Production rose 0.5 percent month-on-month in October following a 1.3 percent increase in the previous month. This was also weaker than the expected 2 percent growth.

Year-on-year, production increased 4.7 percent in October compared with expectations for a 6.3 percent rise.

Japanese manufacturers' operating conditions improved at the sharpest pace in over seven years in November, a survey by Markit Economics revealed Friday. The headline purchasing managers' index rose to 55.1 in November from 54.2 in October. This was the highest reading since July 2006.

Production increased at the sharpest pace since September 2009, while growth in new export orders hit a 42-month high, the survey found.

For comments and feedback contact: editorial@rttnews.com

Business News

Follow RTT