Japanese household spending and core consumer prices fell in October, putting pressure on the country’s central bank for support even as it redefines how it looks at inflation. Meg Teckman reports.
Data out of Japan on Friday (November 27) showing Abenomics on fragile footing in October. The unemployment rate in Japan hit 3.1 percent, its lowest level since 1995. But these workers aren't getting the trickle down from record corporate profits. And disposable income for Japanese consumers has shrunk, with many people keeping their hands in their pockets. Household spending for the month saw an unexpected fall of nearly 2.5 percent. And core consumer prices dropped 0.1 percent, the third straight month of declines. This figure excludes volatile fresh food prices for the country, but does include oil costs - which have been falling for awhile. Due to this continued slump in energy prices, the Bank of Japan has released an internal CPI calculation that includes stripping oil out of the equation. This new indicator shows prices actually rising 1.2 percent in the year to October. A more promising figure for the Bank's hopes of not needing more stimulus to reach its two percent inflation target. ENDS