Japan’s all-item CPI was unchanged at 0.4% yoy in March, matched expectations. CPI core (ex-fresh food), slowed to 0.4% yoy, down from 0.6% yoy, matched expectations. CPI core-core (ex-fresh food & energy) was unchanged at 0.6% yoy, also matched expectations. Corporate service price slowed to 1.6% yoy, down from 2.1% yoy, missed expectation of 1.7% yoy.
The set of data suggested that underlying inflation in Japan was weakened further by the coronavirus pandemic. More downward pressure would be seen in the trend ahead due to falling oil prices. BoJ is going to meet next week and the central bank would be forced to downgrade both economic and price assessments.
Separately, Finance Minister Taro Aso said today that the Ministry is not discussing to remove the cap on asset purchase with BoJ. They’ll closely coordinate with each other on monetary policy. Economy Minister Yasutoshi Nishimura said that, the government’s new coronavirus economic stimulus package could boost GDP by 4.4%. The measures included expanded cash payouts to citizen are worth up to JPY 1.1T.
