Japan Inflation Rate Steady for 4th Month at 0.4%


Consumer prices in Japan rose 0.4 percent year-on-year in July of 2017, the same as in the prior three months and matching market consensus. Prices of food rose at a slower pace while cost of transport rebounded and cost of housing continued to decline.

In July, prices of food increased by 0.6 percent from a year earlier, following a 0.8 percent rise in June, namely, fresh food (-1.1 percent from 0.5 percent), fish and seafood (4.9 percent from 5.5 percent) and fresh fruits (0.9 percent from 1.3 percent). In addition, prices fell further for fresh vegetables (-6.6 percent from -4.0 percent).

Meantime, prices increased more than in a month earlier for fuel, light and water charges (4.3 percent from 3.5 percent in June), mainly due to higher electricity cost (6.1 percent from 4.9 percent). Also, cost rebounded for: transport & communication (0.1 percent from -0.1 percent) and miscellaneous goods and services (0.1 percent from -0.1 percent). 

Cost rose less for medical care (0.1 percent from 0.3 percent) and was flat for clothing and footwear (from 0.2 percent) and culture and recreation (from -0.1 percent). Inflation was steady for education (0.4 percent). 

On the other hand, cost fell for: housing (-0.2 percent from -0.2 percent) and furniture and household utensils (-0.4 percent from -0.4 percent), 

Core consumer prices, which exclude fresh food, edged up to 0.5 percent on the year from 0.4 percent in June and in line with market estimates. It was the highest level since March of 2015.

On a monthly basis, consumer prices were flat, the same as in the preceding two months.

In Tokyo, consumer prices rose 0.5 percent in August, compared to a 0.1 percent rise in a month earlier while markets estimated a 0.3 percent increase. Core consumer prices, which exclude fresh food, increased 0.4 percent and above consensus of a 0.2 percent rise.

Statistics Japan | Rida Husna | rida@tradingeconomics.com
8/25/2017 9:20:14 AM