A Tokyo inflation gauge has eased to the slowest pace in more than a year as Prime Minister Sanae Takaichi’s utility subsidies curbed household energy costs, posing a communication challenge for the Bank of Japan as it looks to proceed with interest rate hikes.
Consumer prices excluding fresh food rose 1.8% in the capital from a year earlier in February, the smallest gain since October 2024, according to figures released by the internal affairs ministry on Friday. That was a touch stronger than the median economist forecast of 1.7%. The Tokyo consumer price index report is a leading indicator for national price trends.
The price gauge was widely expected to weaken for a third straight month as the impact of government steps to lower utility bills starts to impact data. A measure that also strips out energy to reflect the underlying strength of the inflation trend increased 2.5%, staying above the BOJ’s 2% target.
AloJapan.com