Inflation in Tokyo has slowed more than expected as government subsidies meant to offset energy costs distorted readings, a result that isn’t likely to deter the central bank from considering more hikes to its benchmark interest rate.
Consumer prices excluding fresh food in the capital rose 2.2% in February from a year earlier, according to the internal affairs ministry on Friday. That missed the median estimate of 2.3% but was above the Bank of Japan’s target. Inflation barring fresh food and energy gained 1.9%, in a sign that underlying inflation is holding steady.
The yen briefly weakened to ¥150.15 to the dollar after the data before retracing that move.
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