Inflation for Tokyo is available 3 weeks ahead of the national data for the same period, and is looked to as a guide for the country-wide result
(which is a bit of a hit and miss TBH)
Tokyo CPI 0.6% y/y
- expected 0.4%, prior was 0.4%
Tokyo CPI excluding Fresh Food 0.7% y/y
- expected 0.6%, prior was 0.5%
Tokyo CPI excluding Food, Energy 0.4% y/y
- expected 0.3%, prior was 0.2%
- this measure the closest to US core inflation
All three measures are ahead of central estimates, which which is something the BOJ and wider administration will like.
Levels are still WAY below the 2% target (that target is for CPI excluding Food, Energy)
Yen up just a few tics just after the release. I am not going to say that the better result argues as a positive for moving the approach of exit from Godzilla-like monetary accommodation. I guess you can make that argument but its so tenuous that I'll excuse myself from it.
Still, yen up a few tickles,
----
Job market data was out at the same time:
- Japan employment report: May unemployment rate 2.2% (vs. 2.5% expected)
2.2!
Sheesh.
The point I made over in that post is that the labour market is tight, but wage growth is still nowhere to be seen. Which runs counter to standard economic theory. Everyone (economists) says though that the tightness will bring about wage growth,
Yeah ….. but when?
ps. Not dissing the economists, I am nothing if not an embracer of economic theory in this regard. Doesn't stop me recognising this inconsistency …. and from asking when though ….
