Japan January Core CPI Flat, Keeps Policymakers Under Pressure

Falling fuel costs kept Japan’s core consumer prices unchanged in January from a year earlier, well below the central bank’s 2 percent target, highlighting the daunting task policymakers face in attempting to lift Japan out of stagnation.

A separate index by the Bank of Japan that strips away the effect of energy costs also showed inflation slowing, suggesting that weak consumption and falling import costs are discouraging firms from raising prices for a broad range of goods.

The data underscores the challenges the Bank of Japan (BOJ) faces, even after its shock decision last month to adopt negative interest rates, in generating a positive cycle in which rising corporate profits drive up wages and consumption.


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Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam