— Japan July CGPI Revised To +0.0% From -0.1%
— Japan Aug CGPI +0.0% M/M Vs July Revised +0.0%

TOKYO (MNI) – Japan’s corporate goods price index was unchanged
from a year earlier in August, posting no change for the second straight
month after rising 0.4% in the previous two months, data released by the
Bank of Japan on Friday showed.

The year-on-year change in the CGPI was revised to being flat in
July from the preliminary 0.1% drop reported last month.

The August headline reading was slightly stronger than the
consensus call for -0.2%.

The index has been recovering steadily from the record 8.5% drop
marked in August and July 2009, which were the largest year-on-year
drops since the BOJ began compiling the data in 1960.

In May, the CGPI gained 0.4%, marking the first y/y gain since
December 2008, when the index was up 0.9% from a year earlier.

Prices of petroleum and coal products (jet, boat fuel) rose 8.1% on
year, slowing from a revised +10.1% in July, while those of non-ferrous
metals rose 7.2% on year in August, also down from the previous month,
when they gained an unrevised +10.8%.

The petroleum and coal products pushed up the CGPI by 0.46
percentage point and the nonferrous metals increased the CGPI by 0.18
percentage point in August.

Prices of scrap and waste gained 4.5% on year in August, slowing
sharply from a revised 13.7% in July and pushing up the CGPI by 0.03
percentage point.

On a month-over-month basis, the CGPI was unchanged from the
previous month in August, after being flat in July (revised from -0.1%)
and -0.4% in June. It had posted the fifth straight m/m rises through
May.

Electric power and water boosted the CGPI by 0.06 percentage point
from the previous month and nonferrous metals pushed it up by 0.04
percentage point. Among the prices that pushed down the CGPI was those
for petroleum and coal products (-0.05 percentage point).

The number of items whose prices fell from a year earlier totaled
403 (vs. 416 in July), or 47.1% of the basket (48.7% in July), while the
number of items whose prices rose came to 267, or 31.2%, up from 256, or
29.9%, in July, a BOJ official told reporters.

The BOJ’s latest monthly economic report released on Wednesday
said, “Domestic corporate goods prices are expected to be somewhat weak
for the time being, since the effects of the decrease in commodity
prices are likely to continue.”

CGPI generally lags about six months after changes in the country’s
output gap, which was estimated by the Cabinet Office to have shrunk to
a negative 4.8% (about Y25 trillion) in the second quarter of 2010.

tokyo@marketnews.com
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