UPDATE 1-Tokyo core consumer prices stop falling for 1st time in 13 months
* Tokyo core CPI flat yr/yr in Aug vs f’cast -0.2%
* Rising accommodation cost support prices (Adds details, background)
TOKYO, Aug 27 (Reuters) – Core consumer prices in Tokyo stopped falling for the first time in over a year in August, data showed on Friday, underscoring the chance that nationwide inflation will perk up in the coming months on a recovery of domestic demand remained.
The core consumer price index (CPI) for Japan’s capital, which includes oil products but excludes fresh food prices, was flat in August compared with a year earlier, government data showed.
That compared with a median market forecast for a 0.2% fall. It followed July’s 0.3% year-on-year drop, which was revised down from a 0.1% rise.
Tokyo core CPI saw its last year-on-year rise in July last year, when the index gained 0.4%.
The flat reading in the Tokyo index, which is considered a leading indicator of nationwide price trends, was held up by higher prices of overnight hotel stays and household goods, due partly to the base effect of last year’s pandemic-driven slump.
The Bank of Japan’s years of heavy money printing has failed to bring inflation to its 2% target as companies are hesitant to pass on higher costs to households in part due to weak consumer sentiment.
Nationwide consumer inflation has barely risen even as other major economies, such as the United States, are starting to worry about the risk of too-high inflation as their economies do away with pandemic-induced lockdowns.
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