MNI BRIEF: Japan's Aug Trimmed Mean Rises 1.8%, Flat Vs. July
MNI (TOKYO) - Japan’s trimmed mean measure of underlying inflation rose 1.8% in August, unchanged from July’s 1.8, indicating the pace of pass-through of cost increases caused by the weak yen is slowing, data released by the Bank of Japan showed on Wednesday.
The data showed the mode, or the inflation rate with the highest density in the distribution, stood at 1.3% in August, slowing from 1.5% in July, below the BOJ's 2% price target for the seventh straight month.
The trimmed mean followed data released on Friday that showed Japan's annual core consumer inflation rate rose 2.8% y/y in August, up from July’s 2.7% for the 29th straight month above the 2% target.
Bank officials are focused on how the slowing rise in import price (+2.6% in Aug. y/y vs. 10.8% in July) will impact corporate price-setting over the coming months.
BOJ officials believe the underlying inflation trend based on services prices is strengthening and they are focused on whether services price revisions in October will boost overall price revision. (See MNI POLICY: BOJ Hikes To Weather Weaker Consumption)