Inflation in Japan accelerated in February to the highest since November 2.8%

According to the Ministry of Internal Affairs and Communications of Japan, consumer inflation in February reached its highest since November, increasing by 2.8% year-on-year. Thus, the growth rate accelerated compared to 2.2% in January. 

Inflation excluding fresh food prices (the main indicator that the central bank focuses on) also amounted to 2.8% compared with 2% in the previous month, which is in line with analysts' forecasts. 

Analysts note that the key inflation index has remained at 2% or higher for 23 months, which became the basis for the Central Bank of Japan's rejection of the policy of negative interest rates this week. The short-term interest rate on deposits of commercial banks in the Central Bank is now in the range from 0% to 0.1% per annum, previously it was minus 0.1%.

Inflation, excluding the cost of food and energy, was 3.2%, compared with 3.5% in January. In February, there was an increase in food prices by 4.8%, recreation and entertainment prices rose by 7.3%, telecommunications services – by 1.4%. At the same time, energy resources fell in price by 3%, which is the minimum decrease in the last 11 months.