Japan's inflation headwinds go up

Japan's inflation headwinds go up

Japan's attempts to meet its inflation objective have been heavily affected by slow wage surge as well as intensifying global trade frictions. Furthermore, the country’s cabinet is currently facing headwinds from plans by the Japanese number one mobile phone carrier to have fees reduced.

On Wednesday, NTT Docomo Inc told that it would reduce mobile fees by approximately 40% in the April-June quarter of 2019, reacting to the cabinet’s criticism that fees are extremely high because of a lack of competition in the sector.

Other dominant carriers, including SoftBank Group Corp and KDDI Corp could follow suit that could potentially add to the BOJ’s troubles as it’s still difficult for the institution to meet its 2% inflation objective.

NTT Docomo's announcement showed up the same day Japan’s key bank cut its inflation estimates and warned that global uncertainties as well as the public's sticky deflationary mindset might suggest it would take some time to meet its ambitious inflation objective.

The internal affairs ministry, complying the consumer price index, told that a 40% slip in mobile fees by the key carriers could speed down core consumer inflation by approximately 0.96%. By the way, Japan's CPI data includes up to 585 items, such as mobile charges, making up 2.4% of core CPI.

While the actual fee cuts as well as the influence on CPI might appear to be smaller than the ministry's forecasts, the deflationary effect might push inflation away from the major bank’s 2% objective.

Other experts tell that while fee reductions might put pressure on inflation in the short-term, but they could speed up price surge if customers spur spending on other items.

In addition to this, in September, Japan's core consumer prices managed to ascend by 0.7% from 2017, mostly powered by higher energy costs.




Latest news

FED and BOE Make Another Attempt to Beat Inflation
FED and BOE Make Another Attempt to Beat Inflation

The Federal Reserve (Fed) will announce its Interest Rate Decision and make a statement about the future monetary policy on Wednesday, September 21, GMT+3. After the higher-than-expected inflation numbers published on September 13, there’s almost no doubt the Federal Reserve will come up with another 75-basis-point rate hike. However, surprised by the CPI numbers, several Fed members announced the possibility of a 100-basis-point rate hike on Wednesday.

Deposit with your local payment systems

Feel the Team Spirit

Data collection notice

FBS maintains a record of your data to run this website. By pressing the “Accept” button, you agree to our Privacy policy.


A manager will call you shortly.

Change number

Your request is accepted.

A manager will call you shortly.

Next callback request for this phone number
will be available in

If you have an urgent issue please contact us via
Live chat

Internal error. Please try again later

Don’t waste your time – keep track of how NFP affects the US dollar and profit!

Beginner Forex book

Beginner Forex book will guide you through the world of trading.

Beginner Forex book

The most important things to start trading
Enter your e-mail, and we will send you a free Beginner Forex book

Thank you!

We've emailed a special link to your e-mail.
Click the link to confirm your address and get Beginner Forex book for free.

You are using an older version of your browser.

Update it to the latest version or try another one for a safer, more comfortable and productive trading experience.

Safari Chrome Firefox Opera