Japan's September core CPI rises 2.1% year-on-year, first time above central bank target in nine months
Japan's September core consumer price index rose 2.1 per cent year-on-year, exceeding the central bank's 2 per cent target for the first time in nine months, driven by fuel costs, a weak yen and strong AI demand.
Japan's government data showed the national consumer price index (CPI) rose 2.1 per cent year-on-year in September. The core CPI, excluding fresh food, also rose 2.1 per cent, matching market expectations. This marked the first time in nine months that the figure exceeded the central bank's 2 per cent target.
Officials attributed the rise to rising fuel costs from the Middle East conflict, a weak yen pushing up import prices, and strong demand for artificial intelligence putting pressure on prices.
The core-core CPI, which excludes both fresh food and fuel costs, rose 2.4 per cent year-on-year in September, the first time it has exceeded 2 per cent since March. The Bank of Japan closely watches this indicator as a better measure of demand-driven inflationary pressure.
Economy and Fiscal Policy Minister Minoru Kihara said Japan has not yet met the conditions to formally declare an end to deflation. He said the government will consider various factors to ensure it does not repeat the mistake of prolonged falling prices. Kihara expressed hope that the Bank of Japan will appropriately guide monetary policy in line with its joint statement with the government, aiming for stable and sustainable price stability.