Japan Inflation Rate Steady At 0.4% In May

Consumer prices in Japan increased 0.4 percent year-on-year in May of 2017, the same as in April but below market expectations of 0.5 percent. Prices went up faster for electricity but fell further for fresh fruits and vegetables. Core inflation increased to 0.4 percent, the highest since March of 2015.

Year-on-year, prices rose faster for fuel, light and water charges (2.2 percent from 0.9 percent), mainly due to higher electricity cost (2.5 percent from 0.9 percent). Prices also increased more for medical care (0.3 percent from 0.2 percent) and recovered for clothing and footwear (0.1 percent from -0.1 percent).
Inflation was steady for transportation and communication (0.3 percent) and culture and recreation (0.6 percent).
On the other hand, inflation slowed for food (0.8 percent from 0.9 percent), namely for fresh food (0.4 percent from 1.8 percent) and fish and seafood (5.9 percent from 6.7 percent). In addition, prices fell further for fresh vegetables (-1.3 percent from -0.7 percent) and fresh fruits (-4.1 percent from -2.2 percent). Inflation was also lower for education (0.6 percent from 0.7 percent) and miscellaneous goods and services (0.1 percent from 0.2 percent).
Prices of housing went down 0.2 percent, the same as in April.
Core consumer prices, which exclude fresh food, went up 0.4 percent on the year, following a 0.3 percent gain in the prior month and in line with market estimates. It is the highest level since March of 2015.
On a monthly basis, consumer prices were flat, following a 0.1 percent gain in April.
In Tokyo, consumer prices were unchanged in June, following a 0.2 percent rise in May while market estimated a 0.5 percent increase. Core consumer prices, which exclude fresh food were also flat.

Statistics Japan l Joana Taborda | joana.taborda@tradingeconomics.com
6/30/2017 12:08:02 AM