By Chikafumi Hodo
Tuesday, March 31
0830 JST (2330 GMT/1930 EDT Monday, March 30) The Ministry of Internal Affairs and Communications releases March, fiscal 2025 average Tokyo CPI.
Mace News median: total CPI +1.6% y/y (range: +1.4% to +1.6%) vs. Feb +1.6%; core CPI (ex-fresh food) +1.8% (range: +1.6% to +1.9%) vs. Feb +1.8%; core-core CPI (ex-fresh food, energy) +2.4% (range: +2.2% to +2.5%) vs. Feb +2.5%
A mid-month spike in the national average regular gasoline price to a record high in the wake of the Iran war is gradually being contained by the government’s special funds for lowering domestic fuel prices. In addition, processed food price gains have been slowing after domestic rice supply shortages were resolved last year.
The core measure (excluding fresh food) is forecast to have risen 1.8% on year after the annual rate slid to a 16-month low of 1.8% in February from 2.0% in January. The annual rate of the total CPI is also seen steady at 1.6% after edging up to 1.6% in February from 1.5% in January, which was the lowest in about four years. The year-on-year increase in the core-core CPI (excluding fresh food and energy) is projected to moderate slightly to 2.4% after rising to 2.5% in February from 2.4% the prior month.
Two of the key inflation measures are now below the Bank of Japan’s 2% price stability target but that was already projected by the bank in October as the rice price markups had eased after a spike in early 2025.
The bank repeated its quarterly Outlook Report in January that in the second half of its projection period (fiscal 2025 through fiscal 2027), underlying CPI inflation and the rate of increase in the core CPI should increase gradually and will be “at a level that is generally consistent with the price stability target.”
Board members will update their growth and inflation projections as well as risk analysis to include the impact of the war in the Middle East in their latest quarterly report to be issued after the April 27-28 policy meeting.