Japan consumer prices up 0.1% in July

Business News

Japan consumer prices up 0.1% in July     Photos 1 of 1 Customers leave a department store in Tokyo, Japan       TOKYO: Japan's core consumer prices rose 0.1 percent in July from a year earlier, beating market expectations of a 0.1 percent fall, government data showed on Friday. The core consumer price index, which excludes volatile food prices, rose despite market expectations that prices would have fallen due to the yen's strength and the government's revision to the data's base year. Japan has been plagued with a deflationary trend for years and the results came after the government changed the data's base year to 2010 from 2005, which was expected to put a downward bias on the data. Analysts expect the yen's recent appreciation to add further downward pressure to consumer prices. "Considering the impact of the high yen and slowing overseas economies, in addition to the base-year revision, on-year changes in the core CPI are unlikely to turn positive for about the next two years," said Kyohei Morita, chief Japan economist at Barclays Capital. The internal affairs ministry said Tokyo-area consumer prices, a leading indicator for the national trend, fell an estimated 0.2 percent in August against a market forecast for a fall of 0.1 percent. Japan is nevertheless expected to continue on its path of monetary easing, with the Bank of Japan pledging to hold its key rate near zero until it is satisfied prices have stabilised.