Japan consumer inflation slows to 3% in September, heightening deflation fears

TOKYO (AFP) - Japanese consumer inflation slowed further in September, official data showed Friday, adding to concerns about Tokyo's war on deflation.

The nation's core consumer inflation, stripping out volatile fresh food prices, came in at 3.0 per cent year-on-year, down from 3.1 perc ent in August, the internal affairs ministry said.

Prices rose from year-earlier levels largely because the government raised sales tax from 5.0 per cent to 8.0 per cent on April 1, which drove up retail prices.

But the increase appeared to be easing as inflation growth slowed from 3.3 per cent in both July and June and a three-decade high of 3.4 per cent in May.

Excluding the impact of the tax increase, the September rise in core consumer prices was 1.0 per cent, according to a formula by the Bank of Japan (BoJ).

The rate is the half of the bank's ambitious 2.0 per cent inflation target for next year.