With prices that continue to decline, Japan is bucking the global trend of rising inflation — a disconnect that could split its policy stance away from the trajectory of other major economies and further weaken the yen.
While one measure of inflation in the United States hit 4.2% in April, its highest in more than 12 years, a key indicator of consumer prices in Japan dropped 0.1% from a year earlier as falling cellphone charges countered rising energy costs.
With companies in Japan so cautious about passing higher costs on to their customers, the gulf in price moves is set to continue for now — an outcome that could ultimately help an economy teetering on the edge of double-dip recession, by making its currency weaker.
With your current subscription plan you can comment on stories. However, before writing your first comment, please create a display name in the Profile section of your subscriber account page.