CPI Inflation In Japan Nears Target

Core inflation in Japan, which excludes fresh food prices, rose to a fresh five-year high of 1.3% year-over-year in December 2013 from +1.2% in November. This was above the consensus estimate of 1.2%.

Overall inflation increased to 1.6% from 1.5%.  

CPI is heading towards the Bank of Japan's target of 2% but the Japanese government wants businesses there to increase wages in order to solidify the rise in inflation.

More at:

• Japan’s Inflation Accelerates as Abe Seeks Wage Gains

“Consumers will be hit in the pocket from rising prices and the upcoming sales-tax hike,” said Masamichi Adachi, a senior economist at JPMorgan Chase & Co. in Tokyo. “The onus is now on companies to convert their profits into wage increases and capital spending.”

BOJ Inflation Target is 2.0%

The core consumer price index has reached the BOJ’s median estimate of 1.3 percent for the fiscal year starting in April and is more than halfway to its 2 percent target adopted in January last year. When the BOJ unveiled stronger stimulus in April, the central bank said it aimed to hit the goal in about two years. 

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