April 21, 2023
Summary
◆Japan’s March 2023 core CPI (excluding fresh foods) was at +3.1% y/y. New core-core CPI (excluding fresh food and energy) was at +3.8%. The chain index (seasonally adjusted), which removes distortions (upward bias) in CPI figures, shows that new core-core CPI was at +0.5% m/m, repeating the previous month’s trend in registering a high growth rate. We can therefore conclude that recently there has been a strengthening of the growth trend in prices.
◆The rate of wage increases is expected to rise significantly in the 2023 spring wage negotiations. If prices are raised on a wide range of items, including services due to increased personnel expenses, the current supply-driven inflation could change to a more sustainable demand-pull inflation as seen in the US and Europe.
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