Sunday, 3 July, 2022

Japan inflation hits seven-year high

Japan's core consumer prices posted their biggest jump in seven years in April, official data showed Friday, as global commodity prices soared and the yen slumped against the dollar.

The core consumer price index, which excludes fresh food, jumped 2.1 percent year-on-year, according to figures released by the internal affairs ministry.

It was the first time since March 2015 that the figure has breached the 2.0 percent set by the Bank of Japan as its long-term inflation target.

The reading, against market expectations of 2.0 percent, is the eighth consecutive monthly increase following a 0.8 percent rise in March.

And excluding energy, prices were up 0.8 percent in April, against market expectations of a 0.7 percent rise.

That was the first positive figure since July 2020, underpinning the impact of skyrocketing energy costs which have been magnified by higher import prices.

After years of price stagnation, some manufacturers and stores in Japan who rely on imported resources have begun to raise prices.

Japan's economy shrank slightly in the first quarter of 2022, hit by Covid restrictions and higher prices.

Economists expect it to rebound in the April-June quarter, but warn there is significant uncertainty because of rising commodity prices, lockdowns in China and potential virus flare-ups.