Japan Inflation Rate at 29-Month High of 0.7% in August



Consumer prices in Japan rose 0.7 percent year-on-year in August of 2017, following a 0.4 percent rise in the prior four months and matching market consensus. It was the highest inflation rate since March 2015, mainly driven by a faster rise in cost of food.

In August, prices of food increased at a faster 0.9 percent from a year earlier (from 0.6 percent rise in July, namely, fresh food (0.8 percent from -1.1 percent), fish and seafood (4.2 percent from 4.9 percent) and fresh fruits (3.4 percent from 0.9 percent). In addition, prices fell at a slower pace for fresh vegetables (-3.4 percent from -6.6 percent).

Meantime, prices increased more than in a month earlier for: fuel, light and water charges (5.2 percent from 4.3 percent in July), mainly due to higher electricity cost (7.0 percent from 6.1 percent). Also, cost of clothing and footwear went up at a faster 0.6 percent, after a flat reading in July. Cost of medical care rose 1.8 percent, much higher than a 0.1 percent rise in August. In addition, cost rebounded for culture and recreation (0.4 percent 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), furniture and household utensils (-0.2 percent from -0.4 percent) and transport & communication (-0.4 percent from 0.1 percent) 
  
Core consumer prices, which exclude fresh food,  rose 0.7 percent on the year from 0.4 percent in July and in line with market estimates. It was the highest level since March of 2015.

On a monthly basis, consumer prices went up 0.2 percent, compared to a flat reading in the preceding three months.

In Tokyo, consumer prices rose 0.5 percent in a month earlier while markets estimated a 0.6 percent increase. Core consumer prices, which exclude fresh food, also increased by 0.5 percent and in line with consensus.

Japan Inflation Rate at 29-Month High of 0.7% in August


Statistics Japan l Rida Husna | rida@tradingeconomics.com
9/29/2017 12:42:55 AM