Japan consumer inflation rises for second consecutive month in November, ex-food prices decline

Consumer price inflation in Japan rose for the second straight month during the period of November, although it posted decline on an annualized basis, signaling the presence of strong disinflationary headwinds for the world’s third-largest economy.

Japan’s national consumer price index rose at an annualized 0.5 percent in November, following a 0.1 percent year-over-year gain in October, data released by the National Statistics Bureau showed Tuesday. The national CPI index in October recorded its first increase in nine months.

Further, ex-food price inflation, which strips away volatile food prices held firmly in negative territory. Core consumer prices declined 0.4 percent in the 12 months through November, following a 0.4 percent year-over-year drop in the month before.

Also, core-core inflation, which excludes both food and energy, rose 0.1 percent in November. Core-core inflation edged higher 0.2 percent in October. Core inflation in Tokyo declined at an annualized 0.6 percent in October following a 0.4 percent drop the month before.

Moreover, the Bank of Japan’s own inflation index (ex-food-and-energy) came in at 0.2 percent y/y in November, widely in line with market expectations and down from 0.3 percent y/y in Oct.

Meanwhile, the USD/JPY traded at 117.35, up 0.22 percent, while at 5:00GMT, the FxWirePro's Hourly Yen Strength Index remained highly bullish at 118.11 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex