MNI BRIEF: Japan March Tokyo Core CPI Rises 2.4% Vs. Feb 2.2%

The year-on-year rise in the Tokyo core inflation rate accelerated to 2.4% in March from February’s 2.2%, above the Bank of Japan's 2% target for the fifth straight month, data from the Ministry of Internal Affairs and Communications showed on Friday.

Food prices excluding perishables (+5.6% vs. +5.0%) and households’ durable goods (+7.7% vs. +5.5%) boosted the index, despite lower energy prices (+6.1% vs. +6.9%).

The core-core CPI (excluding fresh food and energy) – a key indicator in the underlying trend of inflation – rose 2.2% y/y in March, also accelerating from 1.9% in February and rose above 2% for the first time since March 2024.

Tokyo saw processed food prices, a key BOJ focus, rise 3.5% in March, accelerating from February’s 3.2%, while services prices increased 0.8% from the prior month's 0.6%.

The data underscores the Bank of Japan’s view that inflation is on track, supporting a further rate hike following the 25bp move to 0.50% on Jan. 24. (See MNI POLICY: BOJ Sees Costs Increasingly Pushed To Consumers