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Japan inflation unchanged at 3.1% in March: official data

Japan’s consumer prices rose 3.1 percent in March, matching last month’s figure and roughly in line with expectations, as inflation slows from four-decade highs, government data showed Friday.

The figure, which excludes volatile fresh food prices, was marginally higher than market expectations of a 3.0 percent rise and even with February numbers.

Friday’s figure comes a week before the Bank of Japan’s first policy decision under new governor Kazuo Ueda, who has said the central bank’s longstanding monetary easing policy is “appropriate.”

The 3.1 percent figure is above the two-percent target, which has been surpassed every month since April last year, but Ueda’s predecessor argued that Japan was not yet seeing sustained inflation.

Instead, Haruhiko Kuroda said, the price increases reflected temporary distortions like higher energy prices linked to the war in Ukraine and supply chain disruptions.
Still, excluding energy, the data released by Japan’s internal affairs ministry Friday showed prices rose 3.8 percent in March, after a 3.5 percent rise in February.

The figures are much lower, however, than the sky-high inflation seen in the United States and elsewhere that has prompted central banks to hike interest rates.

The data showed rises in the cost of processed foods, gas bills, transportation and telecommunication fees, among others, contributed to inflation.

And it suggests price increases may continue to fall from a January peak, when inflation measured 4.2 percent on-year — the highest level since September 1981, fuelled in part by higher energy bills.