Tokyo inflation rise faster-than-expected in January

Tokyo’s core consumer prices, a forward-looking indicator used to track price movements for the country, rose 1.1% on a year-on-year basis in January. Economists had expected a 0.9% price gain.

A street in Japan Source: Bloomberg

A pick-up in electricity and gas prices pushed core consumer prices in Tokyo to climb faster-than-expected in January, data from the Ministry of Internal Affairs and Communications showed on Friday.

Tokyo’s core consumer prices, a forward-looking indicator used to track price movements for the country, rose 1.1% on a year-on-year basis in January. Economists had expected a 0.9% price gain.

Tokyo’s overall Consumer Price Index edged up 0.4% in January from a year earlier, increasing in the same pace as the preceding month.

Consumer inflation forecasts lowered, 2.0% inflation target remains elusive

On Wednesday, Japan’s central bank cut its consumer inflation forecasts and maintained its massive stimulus program but Governor Haruhiko Kuroda had warned of the growing risks to the economy due to global trade tensions.

Core consumer inflation was lowered from 1.4% projected last October to 0.9% for the coming fiscal year, due to lower oil prices.

Japan’s central bank however, was positive on its growth outlook for the country for this year, and is expecting it to remain steady even as the country's slated consumption tax hike will be taking place in October.

The Bank of Japan has been struggling to keep to its inflation target of 2.0% amid depressed wages and softening economic activity.

At 5.14pm Tokyo time on Friday, the Japanese Yen changed hands at ¥109.76 against the United States dollar.


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