Japanese inflation jumps to 2.7% in November
Source: AFP
CHECK OUT: Education is Your Right! Don’t Let Social Norms Hold You Back. Learn Online with LEGIT. Enroll Now!
Japanese inflation accelerated in November, with prices rising 2.7 percent on-year partly due to higher energy costs, government data showed Friday.
The core Consumer Price Index (CPI), which excludes volatile fresh food prices, topped market expectations and was up from 2.3 percent in October.
It remained above the Bank of Japan's key two percent inflation target, set over a decade ago as part of efforts to boost the stagnant economy.
The two-percent target has been surpassed every month since April 2022, although central bank policymakers have sometimes questioned the role of temporary factors such as the war in Ukraine.
Analysts had forecast a core CPI reading of 2.6 percent for November. "Core core CPI", which excludes both fresh food and energy prices, stood at 2.4 percent.
The Bank of Japan on Thursday left its borrowing costs unchanged in a policy decision, warning of uncertainty over the US economy under president-elect Donald Trump.
That caused the yen to fall against the dollar, extending a retreat that began Wednesday when the Federal Reserve forecast it would make fewer interest rate cuts.
On Friday morning, one dollar bought 157.61 yen, compared with about 153.60 on Wednesday.
"Despite the pause, the BoJ appears determined to tighten policy further," said Stefan Angrick of Moody's Analytics.
"The central bank's monetary policy statement maintains a fairly hawkish tone, arguing that the economy is recovering and will keep growing above its potential rate -- a view that feels at odds with the data," he said.
Weak demand has been a drag on growth for Japan, and it's likely that data will show the economy shrinking in 2024, Angrick said, adding that the bank faced a tricky situation.
"The domestic economy isn't strong enough for significant rate hikes, but maintaining the status quo risks further yen depreciation and higher inflation," he said.
"We anticipate two more rate hikes in 2025."
PAY ATTENTION: Сheck out news that is picked exactly for YOU ➡️ find the “Recommended for you” block on the home page and enjoy!
Source: AFP
