Japan April Inflation Rate Hits 6-Month High of 0.9%

Japan's consumer price inflation rose to 0.9 percent year-on-year in April 2019 from 0.5 percent in the previous month and in line with market consensus. It was the highest inflation rate since October last year, with prices of food surging following declines in the prior four months.

Prices of food rose by 0.7 percent year-on-year in April, reversing from a 0.3 percent fall in March and marking the first food inflation in five months. Among food, cost rebounded for oils, fats & seasonings (0.2 percent vs -0.2 percent in March), while increased faster for cereals (0.8 percent vs 0.5 percent); fish & seafood (1.6 percent vs 1.1 percent), mostly fresh fish & seafood (0.4 percent vs -0.3 percent); meat (1 percent vs 0.8 percent); and cooked food (1 percent vs 0.3 percent). In addition, prices fell much less for: fresh food (-0.3 percent vs -6 percent in March); vegetables & seaweeds (-0.1 percent vs -9 percent), of which fresh vegetables (-0.6 percent vs -14.2 percent); and fruits (-0.5 percent vs 2.8 percent), namely fresh fruits (-0.7 percent vs 2.7 percent). Meantime, inflation slowed for both meals outside the home (1 percent vs 1.1 percent); and dairy products & eggs (1.5 percent vs 2.3 percent).

Also, cost went up faster for housing (0.1 percent vs  flat reading in the prior three months); furniture and household utensils (1.6 percent vs 1.5 percent); culture & recreation (2 percent vs 0.9 percent); and miscellaneous goods & services (1.1 percent vs 1 percent), while inflation was steady for both clothes & footwear (at 0.1 percent) and education (at 0.5 percent). At the same time, cost of transportation & communication fell less (-0.2 percent vs -0.3 percent). In contrast, inflation slowed for both medical care (0.9 percent vs 1.3 percent); and fuel, light & water charges (4.4 percent vs 5.1 percent), namely electricity (5.8 percent vs 7.3 percent).

Annual core consumer inflation, which excludes fresh food, edged up to 0.9 percent in April from 0.8 percent in March and matching expectations. Still, the latest figure remained well below the Bank of Japan's 2 percent target. Meantime, stripping away the effect of fresh food and energy, consumer prices rose by 0.6 percent year-on-year in April, the most since June 2016.

On a seasonally adjusted monthly basis, consumer prices increased by 0.1 percent, after remaining unchanged in the prior two months.

Japan April Inflation Rate Hits 6-Month High of 0.9%

Statistics Japan l Mario | mario@tradingeconomics.com
5/24/2019 8:48:19 AM