Japan Inflation Hits 32 Year High in December

Japan’ s annual inflation rate rose to 4.0 % in December 2022 from 3.8% a month earlier, the highest reading since January 1991. The BOJ had been trying to get Japan on an inflationary bend for years, now it is clearly hear. The quickening pace of prices comes from high prices of imported raw commodities and yen weakness. Food prices are running up 7.0% vs 6.9% in November, water charges up 15.2% vs 14.1%, electricity (21.3% vs 20.1%) and gas (23.3% vs 21.0%). On a monthly basis, consumer prices rose 0.3% in December, the least in four months, after an upwardly revised 0.4% gain in November. 


Core-core consumer prices also rose by 4.0% year-on-year, the most since December 1981, well above the Bank of Japan’s 2% target for a ninth straight month. Japanese core-core inflation is considered the closest comparison to the US core CPI measure.

Japan CPI for December 2022

  • National CPI 4.0% y/y, expected 4.4%, prior 3.8%
  • National CPI excluding fresh food 4.0% y/y, expected 4.0%, prior was 3.7% (highest since December 1981)
  • National CPI excluding food, energy (core-core) 3.0% y/y, expected 2.9%, prior was 2.8%
Japan CPI Inflation Rate
Japan CPI Core Core

The Bank of Japan recently switched to core-core as its target. 3.0% matched a high last seen in July of 2014.

Source: Statistics Bureau of Japan

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