Econintersect: The expansionary monetary policy of the Abe government continues, but so does the entrenched deflation in Japan. The CPI for April was released today (31 May 2013) and year-over-year the index fell bu 0.7%. The index for goods declined by 1.4% and for services the CPI was unchanged. Japan has now experienced 11 consecutive months of deflation, part of a 21st century record that has produced year-over-year deflation in 106 out of 148 months.
Click on graph for larger image of recent CPI inflation.
Nine of thirteen categories contracted. The largest declines were for food (-1.8%), culture and recreation (-2.3%) and furniture and household utensils (-2.9%). Clothes and footwear prices were unchanged from a year ago. The three increases were for education; fuel, light and water; and miscellaneous. Only fuel, light and water charges gained more than 1% (+2.4%)
Here is the table from Statistics Bureau of the Ministry of Internal Affairs and Communications:
Reuters chose a headline saying deflation “ebbs” but that soft pedals the fact that the last three months have seen the most negative CPI numbers in almost three years.
Sources:
- Preliminary April 2013 CPI (Statistics Bureau of the Ministry of Internal Affairs and Communications, 31 May 2013)
- Japan Inflation Rate (Trading Economics, 31 May 2013)
- UPDATE 1-Japan deflation ebbs, output up; BOJ target still elusive (Reuters, 31 May 2013)
