The consumer price index (2020 = 100) in December last year (2022) increased by 4.0% from the same month of the previous year, excluding fresh food, which fluctuates greatly. The 4.0% increase rate is the first in 41 years since the second oil crisis in December 1981 (4.0%).
Ministry of Internal Affairs and Communications announced on January 20, 2023. Even through 2022, it will rise by 2.3% from the previous year, and excluding the impact of the consumption tax hike, it will be the highest growth in 31 years since the bubble burst in 1991.
Even so, Tokyo Electric Power Company Holdings announced on January 23 that it had applied to the Ministry of Economy, Trade and Industry for a 30% increase in household electricity rates (regulatory rates). What will happen to the Japanese economy? If you read the economist’s analysis…
High price pressure continues due to rising electricity bills from April
Ministry of Internal Affairs and Communications published on the official website“Consumer Price Index for December 2022”According to[Chart 1]the rise in prices is mainly due to increases in food, electricity, and gas prices.
(Chart 1) Trends in the CPI excluding fresh food (from the official website of the Ministry of Internal Affairs and Communications)
Specifically, “edible oil” (33.6% increase), “potato chips” (18.0% increase), restaurant “hamburger” (17.9% increase), “carbonated drink” (15.9% increase), “anpan” increased by 14.1%, while prices of “milk” (up 9.9%), domestically produced “pork” (up 9.4%), and “eggs” (up 7.8%) increased. Looking at energy, “gas” (up 23.3%) and “electricity” (up 21.3%) also increased.
Japan’s capital, Tokyo, where prices continue to rise
How do economists see this situation?
In the Yahoo News comment section, Mr. Shinichiro Kobayashi, chief researcher at Mitsubishi UFJ Research & Consulting, said,
“Inflation pressure for all items excluding fresh food has increased to 4.0% compared with 3.7% in November compared to the previous year. ) and other familiar items continue to rise.”
explained. After that,
“After the turn of the year, the year-on-year rate of increase is expected to slow temporarily due to the fall in crude oil prices and corrections to the yen’s depreciation, as well as the government’s countermeasures against price hikes. High price pressures are likely to continue, as the upper limit is expected to be raised, and we expect the overall price, excluding fresh food, to rise by about 2.2% in 2023.”
and took a stern view.