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MNI 5 THINGS: Japan Feb Core CPI Y/Y Rise Over 3-Year High

--Japan Feb Core CPI +1.0% Y/Y; MNI Median +1.0%; Jan +0.9%
--Japan Feb Core-Core CPI +0.5% Y/Y; Jan +0.4%
--Japan Feb Total CPI Energy Costs +7.0% Y/Y; Jan +6.7%
--Japan Feb Total CPI Accommodations +5.2% Y/Y; Jan +1.0%
--Japan Feb Total CPI Overseas Holiday Tours +8.8% Y/Y; Jan +1.9%
--Japan Feb Total CPI Mobile Phones +8.3% Y/Y; Jan +2.0%
--Japan Feb Total CPI Mobile Communications -3.5% Y/Y; Jan -4.5%
--Japan Feb Total CPI Food Ex-Perishables +1.2% Y/Y; Jan +1.3%
--Japan Feb Total CPI Household Durable Goods -3.8% Y/Y; Jan -2.0%
--Japan Feb Total CPI Electronics Goods -1.5% Y/Y; Jan -1.1%
     TOKYO (MNI) - Key points from the February nation consumer price index
released by the Ministry of Internal Affairs and Communications on Friday.
     -- The national average core consumer price index (excluding fresh food)
rose 1.0% on year in February, as expected, with the pace of increase
accelerating from 0.9% in January due to higher y/y gains in gasoline and
heating oil prices. It was the fastest pace of increase since +1.0% in September
2014, excluding the direct impact of the sales tax hike that year, but it is
still halfway toward the Bank of Japan's 2% inflation target.
     -- The 14th straight year-on-year rise in February was also led by larger
y/y gains in accommodations, overseas holiday tours and mobile phones as well as
smaller y/y drops in mobile communications costs. Chinese tourists rushed to
Japan during the Lunar New Year holidays in February, pushing up the prices for
accommodations here, while strong Japanese demand for traveling to South Korea
for the PyeongChang Winter Olympics led to higher prices for overseas tours.
     -- The core-core CPI (excluding fresh food and energy) rose 0.5% on year in
February after +0.4% in January, posting the highest gain since +0.5% in July
2016 but also showing it still takes time for the underlying inflation trend to
pick up.
     -- The prices for services ranging from rents and restaurants to medicine
and communications rose 0.3% on year in February, up from +0.1% in January,
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 1.8% on year in
February, with the pace of increase slightly faster than +1.7% in January. The
pace of increase in overall goods prices stayed high at +2.7% in February,
unchanged from January in light of continued high prices for fresh vegetables
and fish. The prices for processed food (canned food, bread, snacks, beverages,
etc.), which accounts for 15% of the total CPI, rose 1.1% on year in February
after +1.2% in January.
     --The total CPI rose 1.5% on year in February, with the pace of increase
accelerating from the 1.4% rise in January. It was mainly caused by higher
perishable pries.
--MNI Tokyo Bureau; tel: +81 90-2175-0040; email:
--MNI Tokyo Bureau; tel: +81 90-4670-5309; email:
[TOPICS: MAJDS$,M$A$$$,M$J$$$,MT$$$$]

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