Japan Core Inflation Holds at 1.4% as BOJ Warns Energy Could Breach 2% Target
Updated
Updated · CNBC · Jun 19
Japan Core Inflation Holds at 1.4% as BOJ Warns Energy Could Breach 2% Target
3 articles · Updated · CNBC · Jun 19
Summary
Japan’s core consumer inflation stayed at 1.4% in May, matching forecasts, while headline inflation edged up to 1.5% from 1.4%.
Core-core inflation, which strips out fresh food and energy, eased to 1.8% from 1.9%, suggesting underlying consumer price pressure remained contained.
Energy prices fell 2.5% year on year, a smaller drop than April’s 3.9%, reinforcing Bank of Japan concerns that higher fuel costs could lift its underlying inflation measure above 2%.
Business costs are already rising faster: Japan’s producer prices climbed 6.3% in May, the quickest pace in more than three years, as firms absorbed higher energy bills.
The inflation risk is compounded by a yen near 160 per dollar, which raises import costs for energy as Japan copes with supply fallout from the Iran war.