MNI DATA BRIEF: Tokyo Aug Core CPI Flat, Accommodations Surge

The Tokyo core inflation rate was unchanged in August from a year earlier, and improved from a revised -0.3% in July, as accommodation prices jumped nearly 47%, data from the Ministry of Internal Affairs and Communications showed Friday.

Accommodation costs rose sharply because of lower prices last year under the government's Go To Travel campaign. Communication costs dropped nearly 45% in August on lower mobile phone charges.

The August data reflects revisions after a change to a 2020 base year from 2015 now in effect.

Core-core CPI (excluding fresh food and energy) -- a key indicator in the underlying trend of inflation – fell 0.1% y/y in August in Tokyo, also improving from -0.4% in July.

Processed food prices, which are sensitive to economic activity and closely-watched by the Bank of Japan, rose 0.3% y/y in August, improving from -0.6% in July. Service prices, another important data point for the BOJ, fell 0.8% in August following -1.1% in July.