Japan’s core consumer price index (CPI) recorded the biggest annual slump in over eight year. The country’s core consumer prices recorded a 0.7 percent slump in November from a year earlier, marking serious deflationary pressure on the economy.
It is reported that the latest figures mark the biggest slump since May 2012, when consumer prices recorded a 0.8 percent slump. Furthermore, the core consumer prices included oil products except for fresh food. The core consumer prices also recorded a 0.5 percent slump in October.
The figures are currently challenging the country’s policymakers amid the outbreak of Covid-19 pandemic. It is a decisive moment for Japan’s future. It is reported that low fuel costs and the impact of a government-led campaign providing domestic travel discounts have proved to be costly for Tokyo consumer prices.
The county’s economy surged between July and September from a record slump in Q2 when lockdown measures to contain the spread of the virus eased consumption and hampered business activity. However, experts believe that the outlook is gloomy as recovery will time until a proper vaccine is launched. Until then, the situation is expected to push policymakers to maintain or even surge stimulus.
Dai-ichi Life Research Institute, which expects nationwide core consumer prices to fall 0.5 percent in the fiscal year ending March 2021, told the media, “Consumer prices will continue to hover on a weak note as any economic recovery will be moderate.” The global economic recovery from the pandemic might take longer as fresh lockdown across Europe has halted business activities again.