Friday, 28th October 2016
In General Japan News,
Japan inflation falls to 3-year low
Underlying inflation in Japan has fallen to a three-year low for the first time since 2013, new figures show.
Research from the Ministry of Internal Affairs shows that overall consumer prices dropped 0.5 per cent in September, while core CPI (excluding the volatile prices of food) fell by 0.5 per cent annually.
Fuel prices dropped the most, falling by 6.2 per cent yearly, while communications (-2.1 per cent) and furniture (-1.5 per cent) also decreased. Monthly, the overall CPI rose 0.2 per cent and core inflation was flat.
Core CPI for Tokyo dropped 0.4 per cent against forecasts for -0.5 per cent, whereas overall inflation for Tokyo increased 0.1 per cent compared to 2015 in October, despite predictions for a drop of 0.4 per cent.
Fuel prices were one of the main reasons for the drop, falling 0.8 per cent yearly. Communications expenses also decreased by 1.3 per cent. Monthly, overall CPI for Tokyo rose 0.1 per cent, whereas core inflation fell 0.4 per cent.
As well as this, the unemployment rate in Japan was 3.0 per cent in September, which is below the 3.1 per cent forecast. The job-to-applicant ratio came in at 1.38, which matched forecasts and rose from 1.37 in August.
The average of household spending in Japan fell 2.1 per cent on year in September and was recorded at 267,119 yen.
As well as this, the average of monthly income per household was 424,553 yen, marking a 2.7 per cent jump from the previous year.
It will be interesting to see if Japan’s government now take action to combat the drop, as it is clear that low consumer confidence has resulted in a significant drop in spending across the country. Japan could now turn to its tourism industry in hope of increasing spending, with cities like Tokyo, Kyoto and Osaka proving to be popular for international travellers.