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Core Inflation Stalls in Japan
Japan's core inflation rate, which ignores food prices and a tax increase, dropped to zero in January, according to government data.
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Japan's core inflation rate, which ignores food prices and a tax increase, dropped to zero in January, according to government data. It was the first time since May 2013 that inflation failed to grow.
The Bank of Japan considers 2% expansion normal and had pledged to reach that goal by this spring. Economists predict the central bank will ramp up stronger economic incentives this spring to avert a dangerous deflationary spiral.
Other statistics show household spending in Japan dropped for a 13th consecutive month in February. This time it fell nearly 3% compared with the same month in 2014.
Other government data offer some hope for an economic revival. Japan's unemployment rate dropped one-tenth of a point to 3.5% from January to February. A round of relatively large pay hikes due later this year from the country's largest companies should help bolster average household income.
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