Consumer price growth in Japan accelerated to a 40-year high in October, driven by a weak domestic currency and pressures on imported costs, government data showed on Friday.
According to the report, the national core consumer price index (CPI) rose 3.6% from a year earlier, posting the fastest pace of growth since 1982. Last month’s jump has exceeded the 3.5% increase expected by economists and the 3% gain observed in September.
The rise in the index, which excludes volatile fresh food prices but includes petroleum products, confirmed that inflation remained above the Bank of Japan’s (BOJ) 2% target for a seventh consecutive month.
The report says foreign supply constraints have pushed up the prices of imported food, industrial goods and manufacturing parts. A fall in the yen, the national currency, which in dollars has fallen more than 20% this year, added to the woes.
Of the 522 items making up the CPI, 406 were more expensive in October than a year earlier. In September, the figure was 385.
Energy costs in the country soared 15.2%, while food – excluding perishables – rose 5.9%, the fastest rise in four decades.
Among food products, 88% were more expensive than a year earlier, led by alcoholic beverages, such as beer and sake. Prices for household durable goods jumped 11.8%, their biggest increase since March 1975.
The BOJ forecast that average prices for the fiscal year to March 2023 will be 3% higher than in 2021-22, but the rise for 2023-24 will be only half that.
On Thursday, the regulator pledged to maintain monetary stimulus to achieve wage growth and sustainable, stable inflation. It will keep long-term interest rates around zero and short-term rates at minus 0.1%.
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