Japan Inflation Rate Rises to 6-Month High in August

Japan's consumer price inflation rose to 1.3 percent year-on-year in August 2018 from 0.9 percent in the previous month and above market consensus of 1.1 percent. It was the highest rate since February, due to a jump in prices of food and a faster rise in cost of transport.

In August, prices of food increased by 2.1 percent from a year earlier, way faster than a 1.4 percent rise in the prior month. It was the highest food inflation in six months, driven by prices of meals outside the home (1.1 percent vs 1 percent in July); cooked food (0.7 percent vs 0.5 percent); vegetables & seaweeds (11.3 percent vs 4.3 percent), of which fresh vegetables (15.5 percent vs 4.4 percent); cereals (1.9 percent vs 1.9 percent); fish & seafood (4.8 percent vs 3.9 percent), of which fresh fish & seafood (5.8 percent vs 4 percent); meats (0.1 percent vs 0.2 percent); dairy products & eggs (3.3 percent vs 3.1 percent); and fresh fruits (1 percent vs 4.3 percent).

Additional upward pressure came from: transportation & communication (2 percent vs 1.5 percent), culture & recreation (1.6 percent vs 0.6 percent); fuel, light & water charges (3.4 percent vs 3.1 percent), of which electricity (3.1 percent vs 2.5 percent); medical care (1.1 percent vs 2 percent); and education (0.5 percent vs 0.5 percent). Meanwhile, cost of miscellaneous was flat, following a 0.3 percent rise in July. At the same time, cost continued to fall for housing (-0.1 percent vs -0.1 percent); and furniture and household utensils (-1.1 percent vs -1.1 percent). Also, cost of clothes & footwear declined 0.1 percent, compared to a 0.3 percent rise in July.

Core inflation rate, which excludes fresh food, edged up to 0.9 percent from 0.8 percent in the previous two months and in line with expectations. It marked the highest figure since March.

On a monthly basis, consumer prices went up by 0.5 percent in August, after a 0.3 percent rise in July and reaching the highest monthly figure since November 2017.

Japan Inflation Rate Rises to 6-Month High in August

Statistics Japan | Rida | rida@tradingeconomics.com
9/21/2018 10:07:49 AM