Japan’s inflation slowed for the first time in more than a year in February, as government energy subsidies masked the stronger underlying trend ahead of the Bank of Japan’s first leadership change in a decade.
Consumer prices excluding fresh food rose 3.1% from a year ago, decelerating by more than a percentage point from the previous month on cheaper energy costs, the internal affairs ministry reported Friday.
While the key gauge for the central bank slowed in apparent good news for incoming Gov. Kazuo Ueda, a separate index that strips out fresh food and energy accelerated to the fastest pace in over four decades, pointing to quickening fundamental price strength. That could stoke market speculation that Ueda may have to move toward policy normalization sooner rather than later.