Japan’s Sept. core consumer prices up for 1st time in 18 months – The Foreigners magazine In tokyo
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Japan’s Sept. core consumer prices up for 1st time in 18 months

Written by on October 22, 2021

TOKYO, Oct. 22 (Xinhua) — Japan’s core consumer prices rose 0.1 percent year-on-year in September, logging the first increase in 18 months, government data showed Friday.

The increase was pushed up mostly by the increasing energy prices, which was up 7.4 percent from a year earlier, marking the fastest pace in about three years.

Kerosene prices surged 20.2 percent, and gasoline prices jumped 16.5 percent, according to the Ministry of Internal Affairs and Communications.

In addition, tracking crude oil prices but with a delay of three to five months, electricity bills rose 4.1 percent in September.

Another major contributor to the increase was accommodation fees, which surged 43.1 percent from a year earlier.

However, mobile phone charges dropped 44.8 percent with major Japanese carriers offering cheaper plans amid government pressure.

The Bank of Japan will probably keep the monetary easing because it expected inflation only to pick up moderately, and its 2 percent inflation target is yet to achieve.

“Consumers may feel prices are rising. But it doesn’t mean that inflation expectations will also rise as Japan has experienced years of deflation,” said Yuichi Kodama, the chief economist at the Meiji Yasuda Research Institute.

The yen against the U.S. dollar and other currencies has been decreasing in recent days. Toru Suehiro, a senior economist at Daiwa Securities Co., said, “The impact of the weaker yen will be felt more in imported consumer products in coming months.”

Suehiro added that the surged prices of imported goods and wholesale prices could cool consumer sentiment since domestic demand was still weak due to the COVID-19 pandemic.

The core-core CPI, which excludes both fresh food and energy items, fell 0.5 percent and logged its sixth consecutive decrease on a monthly basis.

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