Japan's Prices Fail to Make Further Progress to Distant BOJ Goal




  • In Business
  • 2022-01-20 23:38:03Z
  • By Bloomberg
 

(Bloomberg) -- Gains in Japan's key consumer prices failed to accelerate toward the Bank of Japan's target in December, highlighting ongoing weakness in the economy's inflation pulse in stark contrast to its global peers.

Most Read from Bloomberg

  • Early Omicron Breakthroughs Show mRNA Vaccines' Weakness

  • Why Some Vaccinated People Resist Omicron and Others Don't

  • Late Rout in Tech Sends Nasdaq 100 Into Correction: Markets Wrap

  • Thailand to Resume Quarantine-Free Tourism as Covid Eases

  • Biden Expects Russia to 'Move In' on Ukraine; Warns of Sanctions

Consumer prices excluding fresh food rose 0.5% in December from a year earlier, according to the ministry of internal affairs Friday. Economists had expected a 0.6% gain.

The subdued inflation reading is likely to further cool speculation that the BOJ may take steps to adjust policy in light of price increases. Governor Haruhiko Kuroda said earlier this week that the start of a normalization of policy is "absolutely not" on the table.

While the central bank said that price risks are balanced for the upside and downside for the first time since 2014, it still only forecasts inflation of around 1% through early 2024.

The Friday data follow reports from the U.S. and U.K earlier this month showing the highest inflation in decades, outcomes that are likely to feed into further divergence in monetary policy to come.

What Bloomberg Economics Says...

"Looking ahead, we expect core inflation to slow slightly in 1Q 2022. Base effects will probably overcome upward pressure from elevated energy prices and a weaker yen."

-- Asia Economist Team

Click here to read the full report.

Still, even with muted price gains, Kuroda said it remains important to watch how households and companies react to increasing price pressures arriving from offshore given their entrenched deflationary mindset.

The highest gains in input prices for Japanese businesses in four decades suggest that some passing of higher costs onto consumers is becoming more inevitable.

Most Read from Bloomberg Businessweek

  • Microsoft Makes a $69 Billion Down Payment on the Metaverse

  • Wall Street Traders Muscle Into the Middle of Crypto

  • One Year Into His Term, Biden Finds Himself Boxed In on China

  • Work From Home Is Becoming a Permanent Part of How Jobs Are Done

  • One Year Into His Presidency, Biden Hits a Wall. Can He Recover?

©2022 Bloomberg L.P.

COMMENTS

More Related News

Eleven Arrested at Chipotle Worker Rally in Manhattan
Eleven Arrested at Chipotle Worker Rally in Manhattan

(Bloomberg) -- Chipotle Mexican Grill Inc. workers and activists gathered in Midtown Manhattan on Thursday to demand better conditions and a $20 minimum wage...

Trump, Don Jr. and Ivanka Must Testify in New York Probe, Appeals Court Says
Trump, Don Jr. and Ivanka Must Testify in New York Probe, Appeals Court Says
  • World
  • 2022-05-26 21:11:05Z

(Bloomberg) -- Former President Donald Trump must testify under oath in New York's "well founded" probe of his company, a state appeals court ruled.Most Read...

Stacey Abrams Is Showstopper in Georgia
Stacey Abrams Is Showstopper in Georgia's GOP Showdown
  • World
  • 2022-05-26 21:05:25Z

(Bloomberg) -- Stacey Abrams was the star of Georgia's final Republican gubernatorial primary debate, even though she was nowhere near the event. During the ...

Elephant-Rich States Row Back From Threat to Quit Trade Body
Elephant-Rich States Row Back From Threat to Quit Trade Body
  • World
  • 2022-05-26 19:41:18Z

(Bloomberg) -- A group of Southern African countries where two thirds of the world's African Elephants live rowed back from a threat to leave an...

NYC Luxury Theft Boss Planned Own
NYC Luxury Theft Boss Planned Own 'Department Store,' City Says
  • World
  • 2022-05-26 18:58:44Z

(Bloomberg) -- The alleged ringleader of an elaborate scheme to shoplift luxury goods from Bloomingdale's, Sephora and other retail outlets and resell them...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Business