MNI 5 THINGS: Japan Apr Core CPI Slows To +0.7% Y/Y on Energy

--Japan Apr Core CPI +0.7% Y/Y; MNI Median +0.8%; Mar +0.9% 

--Japan Apr Core-Core CPI +0.4% Y/Y; Mar +0.5% 

--Japan Apr CPI Energy Costs +5.3% Y/Y; Mar +5.7% 

--Japan Apr CPI Mobile Phones +3.9% Y/Y; Mar +26.0% 

--Japan Apr CPI Food Ex-Perishables +1.1% Y/Y; Mar +1.1%

--Japan Apr CPI Household Durable Goods -3.8% Y/Y; Mar -3.3% 

--Japan Apr CPI Electronics Goods -5.0% Y/Y; Mar -2.5% 

--Japan Apr CPI Accommodations -2.3% Y/Y; Mar +0.4% 

--Japan Apr CPI Overseas Holiday Tours +9.8% Y/Y; Mar +5.9%

     TOKYO (MNI) - Japan's national average core consumer price index (excluding

fresh food) rose 0.7% on year in April, with the pace of increase decelerating

further from +0.9% in March and +1.0% in February on lower utility costs, the

Ministry of Internal Affairs and Communication said on Friday.

     The recent development indicates that the Bank of Japan is unlikely to

achieve its 2% inflation target in the next few years.

     The key points from the April CPI data:

     -- The year-on-year rise in the core CPI (excluding fresh food) slowed to

0.7% in April from +0.9% in March on lower year-on-year increases in the prices

for electricity, mobile phones and hotels.

     -- The16th straight year-on-year rise in April continued to be led by

gasoline and medical services. Overseas holiday tours rose at a faster pace of

9.8% on year in April, up from 5.9% in March.

     -- The underlying inflation rate measured by the core-core CPI (excluding

fresh food and energy) rose 0.4% on year in April, also slowing from +0.5% in

March, which was the largest gain since +0.5% in July 2016.

     -- The prices for services ranging from rents and restaurants to medicine

and communications rose 0.3% on year in April, up from +0.2% in March, partly

due to labor shortages. But the pace of y/y increase remains slow as some

companies are resisting price hikes amid tough competition by investing in

technology and curtailing business hours to cut costs.

     -- Goods prices excluding volatile fresh food prices rose 1.3% on year in

April, with the pace of increase slowing from +1.6% in March. The pace of

increase in overall goods prices decelerated sharply +1.0% in April from +2.0%

in March as the prices for fresh eased after surging late last year and staying

high until recently. The prices for processed food (canned food, bread, snacks,

beverages, etc.), which accounts for about 15% of the total CPI, rose 1.0% on

year in April after +1.0% in March.

     --The total CPI rose 0.6% on year in April, with the pace of increase

decelerating sharply from the 1.1% rise in March due to lower perishable prices.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI Tokyo Bureau; tel: +81 90-4670-5309; email: max.sato@marketnews.com

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