Japan sees inflation uptick driven by energy prices

Japan’s core consumer prices in March rose 1.8 percent from a year earlier, driven by higher energy costs following surges in crude oil prices amid the Middle East conflict, government data showed on Friday.

The increase in the nationwide consumer price index, which excludes volatile fresh food prices, followed a 1.6 percent rise in February, when it climbed by less than 2 percent for the first time in nearly four years, according to the Ministry of Internal Affairs and Communications, News.Az reports, citing Kyodo.

Core-core CPI, which excludes both energy and fresh food to better reflect underlying price trends, rose 2.4 percent in March, slowing from a 2.5 percent increase in February.

For the fiscal year that ended in March, core CPI increased 2.7 percent from a year earlier, largely due to sharp rises in rice prices, which surged a record 48.9 percent during the year. However, it remained flat compared with fiscal 2024.

The removal of a provisional gasoline tax on December 31 helped slow consumer price increases in January and February, but fresh inflationary pressures remain due to higher crude oil prices. The tax had been abolished to ease the burden on households facing inflation.

In March, energy costs fell 5.7 percent after a 9.1 percent drop in February, while gasoline prices declined 5.4 percent year-on-year compared with a 14.9 percent fall in the previous month.

Rising fuel costs may continue to be partially offset while a government subsidy program remains in place.

The government has decided to provide support to wholesalers to keep the average retail price of gasoline around 170 yen per liter. Before this support, prices had reached an all-time high of 190.80 yen per liter on March 16.

Japan depends on the Middle East for more than 95 percent of its oil imports.

News.Az 

By Nijat Babayev