MNI BRIEF: Japan's Trimmed Mean Rises 3.0% Vs. May 3.1% - BOJ

Japan's trimmed mean measure of underlying inflation slowed to 3.0% y/y in June from May's 3.1% as import import prices fall from a year earlier and despite continued pass-through of cost increases, data released by the Bank of Japan showed on Tuesday.

The decelerated trimmed measure to 3.0% followed data released on Friday which showed Japan's annual core consumer price index rose 3.3% y/y in June, accelerating from May's 3.2% for the 15th straight month above the 2% target. (See MNI BRIEF: Japan June Core CPI Rises 3.3% Vs. May +3.2%) Tuesday's data showed the mode, which is the inflation rate with the highest density in the distribution, stayed at a record high of 2.9 in June, unchanged from May's 2.9%. The mode-based measure of underlying inflation was above the Bank of Japan's 2% price target for the fifth straight month.

The BOJ maintains the view that the y/y rise of core CPI will decelerate, but some officials believe this may not be the case. The board’s median forecasts for core inflation rate in fiscal 2023, 2024 and 2025 are +1.8%, 2.0% and 1.6%. The 2023 core CPI will be revised up above 2% on Friday when the policymakers update their medium-term view.