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Approaching Major Support

US TSYS SUMMARY

Inflation Concerns Underpin Bear Steepening

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Bullish Theme

MNI (Tokyo)
TOKYO (MNI)

The negative contribution from lower mobile phone charges on Japan's CPI is within the forecast range and underlying trends -- excluding special factors -- remains solid, according to officials at the Bank of Japan.

Prices for mobile phone charges fell 26.5% y/y in April as operators cut costs, worsening from a rise of 1.9% in March. The April Tokyo core CPI was lowered by 0.45 pp due to cuts and bank officials forecast negative contribution from the lower charges to April nationwide CPI to widen to 0.56 pp, which is within the BOJ forecast of between -0.5 and -1.0 pp.

This is because that the weight of mobile phone charge in nationwide CPI is larger than that of Tokyo CPI. April Tokyo core CPI fell 0.2% y/y for the ninth straight drop following -0.1%.

MNI Tokyo Bureau | +81 90-2175-0040 | hiroshi.inoue@marketnews.com
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