Research Team at Nomura, notes that the all-Japan core CPI (general index excluding fresh food) was +0.0% y-y in January, in line with the consensus (Bloomberg survey median) forecast and down from +0.1% in December 2015.

Key Quotes

“The all-Japan core CPI was +0.7% y-y (consensus: +0.7%), down from +0.8% in December, weighing on the core CPI. Durable goods including TVs, room air conditioners, and refrigerators put downward pressure on the inflation rate. The core food CPI (excluding fresh food and alcoholic beverages) inflation rate in January was +2.2%, down from +2.5% in December. Estimates for the Bank of Japan's core CPI excluding fresh food and energy put inflation based on this measure at +1.1% in January, versus +1.3% in December.

Tokyo core CPI in February above consensus forecast: The core CPI for Tokyo was -0.1% y-y in February, compared with the consensus forecast of -0.2% and in line with the January reading. The Tokyo core core CPI inflation rate in February was +0.5%, up from +0.4% in January (consensus: +0.4%), making a positive contribution to Tokyo core CPI inflation. Consumer durables price inflation remained weak, but prices of clothing picked up after falling sharply in January amid fallout from warm winter weather. Against a backdrop of falling crude oil prices, energy price inflation in February was -13.5% y-y, versus January's -12.3%, weighing on the Tokyo core CPI. The core food CPI (excluding fresh food and alcoholic beverages) inflation rate was +2.2%, unchanged from January. Calculation for the BOJ-version core CPI gives an inflation rate of +1.0% for February, up from +0.8% for January.

All-Japan core CPI inflation rate likely to narrow on low oil prices, slowing yen depreciation: The Tokyo inflation rate was slightly higher than expected in today's set of figures. In our view, however, this probably reflects the impact of slowing yen depreciation, bearing in mind weak inflation rates for consumer durables and core food. We think the negative impact of energy prices on inflation rates is unlikely to drop out any time soon, taking as our reference point crude oil prices in the futures market. We also see a high probability of gradually weakening upward pressure on prices from yen depreciation. We expect the all-Japan core CPI inflation rate to be slightly negative y-y during 2016.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Are you new to trading or have been trading for a while and you feel stuck?

Try with us!
Become Premium!

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD skyrockets to 1.2150 on poor US jobs figures

EUR/USD has hit a new multi-month peak above 1.2150 after the US reported an increase of only 266,000 jobs in April against nearly one million expected. The dollar is under immense pressure. 


GBP/USD soars toward 1.40 after disappointing Nonfarm Payrolls

GBP/USD has been extending its gains after the US Nonfarm Payrolls badly disappointed with an increase of only 266,000 jobs in April, nearing 1.40. Earlier, sterling benefited from the UK Conservative Party's gains in local elections. 


XAU/USD soars above $1,835 after weak Nonfarm Payrolls

Gold has leaped above $1,835 after the US reported an increase of only 266K jobs in April, far below expectations. Lower US yields support the precious metal.

Gold News

Judge reaffirms order SEC must produce documents on Bitcoin, Ether and XRP in Ripple case

Ripple's victory granted the firm access to the SEC's documents on the three leading cryptocurrencies. The regulatory agency recently denied the possession of these documents.

More Dogecoin News

S&P 500 and Nasdaq: Can the Fed pump anymore after weak jobs report

Well, that was an interesting jobs report. Not too many people were forecasting that one. Just in case you missed it NFP were forecast to come in around the 1 million jobs gained but instead the US only added 266k.

Read more