Japan’s Consumer Inflation Rises to Highest Level in 40 Years

Core consumer prices in Japan rose by 3.6% year-on-year in November. This was the highest annual rate in 40 years and a sign of increasing inflationary pressure.

Data released by the government on Friday showed Tokyo’s core consumer price index (CPI), which excludes fresh food but includes fuel, rose above expectations to 3.5%, accelerating from 3.4% in October.

Core consumer inflation in Tokyo was above the Bank of Japan’s target of 2% for six consecutive months in November. This is a sign that rising raw material costs have continuously pushed up prices for everyday goods.

Tokyo’s core inflation index (excluding food and fuel) rose 2.5% in November from a year earlier, up from 2.2% in October.

The Bank of Japan has kept interest rates extremely low because it believes the recent rise in inflation is temporary.

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