Japan logs first consumer price rise in over a year

PHOTO: Japan logs first consumer price rise in over a year

TOKYO - Japan's consumer prices rose in June for the first time in 14 months, official figures showed Friday, as Tokyo looks to tackle years of deflation that have crippled growth in the world's third-largest economy.

Excluding volatile prices of fresh food, prices rose 0.4 per cent in June, the first increase since a 0.2 per cent rise in April last year, according to the internal affairs ministry.

Prime Minister Shinzo Abe has vowed to pull Japan out of 15 years of falling prices with active government spending, which he argues will boost the economy and eventually lead to higher pay for workers.

His hand-picked governor at the Bank of Japan, meanwhile, unleased a huge monetary easing programme in April and set a two-per cent inflation target aimed at turning around the economy.

Japan's economy expanded at an annualised rate of 4.1 per cent in the first quarter, and some Japanese firms have recently announced price increases as the yen weakened sharply since late last year.

While the data Friday may be a good sign, much of the price increase can be attributed to surging energy costs in the wake of the Fukushima atomic disaster two years ago.

The country turned to pricey fossil-fuel imports in the wake of the accident after shutting down its nuclear reactors. A weaker currency has pushed up the costs of those imports.