Tokyo core CPI rises to 22-yr high after Japan's April tax hike
Published on Apr 25, 2014 8:43 AM
TOKYO (Reuters) - Core consumer prices in Tokyo, a leading indicator of nationwide inflation, rose 2.7 per cent in April from a year earlier to mark the biggest gain in more than two decades, offering the first glimpse on how Japan's sales tax hike is pushing up prices across the board.
Nationwide core consumer inflation also matched a five-year high of 1.3 per cent in March from a year ago, government data showed on Friday, and is expected to track the Tokyo index's spike next month.
Stripping off the impact of the April 1 tax hike, Tokyo core consumer inflation - available a month earlier than nationwide figures - rose 1.0 per cent year-on-year in April, indicating that Japan is still some way off the central bank's 2 per cent price target.
"Considering that the sales tax hike boosted prices by 1.7 percentage points, the Tokyo core CPI is steady with the March data and this shows that companies are not fully reflecting the tax hike in prices," said Junko Nishioka, chief economist at RBS Securities in Tokyo.
To continue reading, log in if you are a subscriber
Enjoy 2 weeks of unlimited digital access to The Straits Times. Get your free access now!