Japan’s core consumer prices eased in November from the previous month as lower oil prices helped reduced energy costs.
Consumer prices rose 0.9% for last month from a year ago, slower than the 1.0% gain in October, data from the Ministry of Internal Affairs and Communications showed. Economists had expected a 1.0% gain in November.
November’s reading makes it the 23rd consecutive month of increase in consumer prices. The indicator excludes fresh food prices due to their volatility to seasonal changes.
For last month, the largest contributors to the gain were energy items such as gasoline and kerosene but the prices of those items rose slower than the previous month due to fallen global oil prices.
The Bank of Japan has been struggling to keep to its inflation target of 2.0% amid depressed wages and softening economic activity.
Depressed wages and weak economic growth
The country’s employee wages saw a recent weakening in growth, with real wages declining by 0.4% in September after adjusting for inflation.
The employment situation in Japan reflects a weaker third quarter economic growth for the country. Japan’s economic growth for the third quarter shrank 0.6% from the previous quarter, lower than the preliminary forecast of a 0.3% decline and economists’ expectations of a 0.5% fall.
Economists expect the country to rebound for the last quarter of the year, as the third quarter’s performance was met with natural disasters which affected businesses.
The country was hit by a slew of natural disasters from July to September, such as an earthquake in the north which affected supply lines, flooding in the western parts of the country due to heavy rainfall, and a typhoon.
The natural disasters that took place in the third quarter led to consumers tightening their purse strings in October as household spending fell. Fresh vegetable prices had risen by more than 20.0% in October compared to a year ago as the bad weather reduced crop takings.
At 10.49am Tokyo time on Friday, the Japanese Yen changed hands at ¥111.19 against the United States dollar.