Japan’s consumer price growth in July slowed from the previous month, nudged lower by falling energy prices and complicating central bankers’ task as they debate a historic shift in monetary policy. The “core” inflation rate, which excludes volatile fresh food prices, retreated to 3.1 per cent in July from 3.3 per cent the previous month.
The reading, released on Friday and in line with economists’ forecasts, marked the 16th consecutive month that the index exceeded the Bank of Japan’s target of 2 per cent. The lower rate supported some central bankers’ belief that Japanese inflation had peaked after reaching its highest level in four decades this year following a long period of negative or near-zero growth.
Higher prices, along with interest rate rises by other major central banks, have put pressure on the BoJ as it considers unwinding its ultra-loose monetary policy, which includes the world’s only negative rates. Headline inflation, which includes fresh food prices, remained flat from the previous month at 3.3 per cent.
Food price inflation has proven particularly resilient and remains vulnerable to external jolts such as Russia’s withdrawal last month from the Black Sea grain deal, noted Moody’s Analytics senior economist Stefan Angrick.
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Source: www.ft.com
ENB
Sandstone Group
