TOKYO : Core consumer inflation in Japan’s capital Tokyo likely grew in November but at slower pace than the month before, a Reuters poll of economists showed on Friday, in a sign that price pressures may be easing.
The core consumer price index (CPI) in Tokyo, a leading indicator of nationwide inflation trends, was expected to have climbed 2.4 per cent in November from a year earlier, according to the median estimate of 16 economists, mainly thanks to falling fuel prices and slower food price increases. That would follow a 2.7 per cent increase in October.
“Although government subsidies have been halved, electricity and other prices are expected to fall again as crude oil prices peak out, and the momentum of food price hikes is slowing,” said Shunpei Fujita, a deputy chief researcher at Mitsubishi UFJ Research and Consulting.
Although the Bank of Japan has maintained ultra-loose monetary policy, many market players expect the Japanese central bank to end both yield curve control (YCC) and its negative rate policy next year with inflation exceeding its 2 per cent target for more than a year.
Economists in the poll also expected the first month-on-month contraction in household spending in three months in October, squeezed by price pressures.
Household spending likely dropped 0.2 per cent in October from the previous month and declined 3.0 per cent from the same month a year earlier, according to the poll.
Meanwhile, the poll also estimated Japan’s current account balance would be a surplus of 1.90 trillion yen ($12.83 billion) in October following September’s 2.72 trillion yen surplus.
The government will release the Tokyo CPI data on Dec. 5 at 8:30 a.m. JST (Dec. 4 at 2330 GMT). Household spending data is due at 8:30 a.m. on Dec. 8 (Dec. 7 at 2330 GMT) and the current account data will be available at 8:50 a.m. on Dec. 8 (Dec. 7 at 2350 GMT).
($1 = 148.0700 yen)
Source: CNA
