Japanâ€™s consumer prices slid at a faster pace in July and industrial production unexpectedly slumped, raising the danger that the worldâ€™s third-largest economy has slipped back into a contraction.
The benchmark price gauge, which excludes fresh food, fell 0.3 percent in July from a year before, putting the central bankâ€™s 1 percent inflation goal further from reach, a government report showed in Tokyo. Industrial output fell 1.2 percent. A private measure of manufacturing for August was the lowest since the aftermath of the record March 2011 earthquake.
Todayâ€™s releases reflect diminishing demand overseas for the nationâ€™s exports amid the European crisis and exchange-rate appreciation, and the end of incentives for vehicle purchases. With Prime Minister Yoshihiko Nodaâ€™s government today predicting it will miss a deficit-reduction target, pressure may rise on the Bank of Japan (8301) to expand stimulus and sustain the recovery.
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