Log in
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Dynamic quotes 

MarketScreener Homepage  >  Currencies  >  Euro / Japanese Yen (EUR/JPY)    EURJPY   


SummaryMost relevantAll NewsMarketScreener Strategies

Japan's consumer prices continue to slide on deflationary pressure from COVID-19

10/22/2020 | 07:44pm EST

* Sept nationwide core CPI falls 0.3% yr/yr vs f'cast -0.4%

* Slide in energy costs, govt travel subsidies weigh on CPI

* Excluding effect of govt campaign, core CPI was flat yr-yr

* BOJ seen trimming growth, price f'casts next week - sources

TOKYO, Oct 23 (Reuters) - Japan's core consumer prices slipped for the second consecutive month in September, a sign that a coronavirus-induced demand downturn is piling deflationary pressure on the world's third-largest economy already blighted by recession.

The data is likely to heighten expectations the Bank of Japan (BOJ) will maintain its massive stimulus programme to cushion the economic blow from the pandemic, analysts said.

But analysts mainly blamed the drop on a government campaign aimed at promoting domestic travel, underscoring the tricky task of supporting the economy without pushing inflation further away from the central bank's 2% target.

"The declines in August and September were caused largely by the government's travel discount campaign," said Takeshi Minami, chief economist at Norinchukin Research Institute.

"Weak service-sector demand could exert further downward pressure on prices at least until the coronavirus is contained."

The nationwide core consumer price index (CPI), which excludes volatile fresh food but includes energy, fell 0.3% in September from a year earlier, government data showed on Friday. That compared with a median market forecast for a 0.4% decline.

When stripping away the effect of the government's travel discount campaign, core consumer prices were flat in September from a year earlier, the data showed.

The data will be among factors the BOJ will scrutinise at next week's rate review. People familiar with BOJ thinking have told Reuters the bank is likely to slash its economic and price forecasts for the current fiscal year.

Japan's economy suffered its biggest postwar slump in the second quarter of the year, and analysts expect any rebound to be modest due to soft consumption and capital spending.

While demand for durable goods is picking up, social distancing policies and fears over a resurgence in infections continue to weigh on service consumption.

As part of efforts to rescue Japan's ailing tourism sector, the government in July started a campaign offering discounts for domestic travel that is set to last until January next year. (Reporting by Leika Kihara; Additional reporting by Tetsushi Kajimoto; Editing by Jane Wardell and Christopher Cushing)

© Reuters 2020
All news about EURO / JAPANESE YEN (EUR/JPY)
02:49aFACTBOX : BOJ tiptoes into industrial reform with regional bank aid
02:49aANALYSIS : With new bank aid, BOJ makes stealthy retreat from negative rates
11/25Stocks hit record high as Biden, vaccine lift investor outlook
11/24Stocks hit record high as Biden, vaccine lift global prospects
11/23BOJ's Kuroda says no immediate need to overhaul policy framework
11/23Soybeans fall for first time in eight sessions
11/23Yen on slippery ground as Yellen, Trump transition news boost risk appetite
11/23Vaccine developments keep dollar down; Aussie and Kiwi strengthen
11/20Dollar gains in tug-of-war between vaccine, rising virus cases
11/20Dollar gains in tug-of-war between vaccine, rising virus cases
More news
Duration : Period :
Euro / Japanese Yen (EUR/JPY) Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends EURO / JAPANESE YEN (EUR/JPY)
Short TermMid-TermLong Term