Japan Core Consumer Prices: Updated Dec. 24, 2025.

Japan's core consumer prices in November rise 3.0% on year

Article source: https://mainichi.jp/english/articles/20251219/p2g/00m/0bu/010000c

Ideas:

Japan is a resource poor country and has to import much of what it needs including raw material for the production of food products. At the same time, the Japanese yen is very weak an a weak yen drives up import prices. Importers and wholesalers then will pass-on the high costs of imports to the next in the supply chain including the final retail customer.

Yes, the inflation rate is above the 2 percent target of the BOJ but they haven't done much about it yet but it is expected they will move soon to try and reduce inflation in Japan.

In relation to energy prices, again Japan imports most of its energy as its not a oil producing country which means is potentially subject to global oil prices or oil supply and demand.

The BOJ has increased the key rate a few times but despite the few times it has done it inflation has not decreased much or not at all. 

The challenge for the BOJ is that they have suggested many times, or at least in the past, that the Japanese economy is/was too weak to handle any rate increases and or a large rate increase that might damage the economy with a lot of side effects.

So Japanese households and Japanese consumers suffer with high inflation which reduces their disposable income to buy other things in the economy besides just paying their bills or buying basic food products they need.

An in increase of 3.0 percent might not seem like much for the lower-income groups or the fixed income groups, or those who only have part-time jobs that could be a lot and could force them to makes changes in what they need or what they buy in the future.

There is no easy answer to inflation in Japan, in the EU, or in the US as inflation has hit all areas of the world with equal force lately,

US consumers are struggling with what is called an affordability crisis, meaning higher than normal food prices, higher than normal housing prices, and higher than normal prices on everything.

The rice situation is very perplexing as rice is the main staple of Japanese homes and it seem odd that the powers to be in Japan haven't been able to keep prices down as its a main food ingredient like milk, bread, eggs, and some meat in other places.

Yes, raw materials costs related chocolate and even coffee has increased globally to where prices are high everywhere in the world for chocolate and coffee products these days.

Rice balls or using the phrase onigiri, which is a basic rice product at most Japanese convenience stores has probably increased too but not to the point for most convenience stores shoppers in Japan.

Japan needs a different strategy to handle energy prices like some kind of energy trade agreement with energy producing countries so that it isn't at the mercy of global energy prices or at the mercy of the weak Japanese yen which increases import prices which oil is a major import as Japan has to import much of what it needs.

It seems odd that Japan hasn't developed some kind of FTA agreement with oil producing counties or found ways to limit the ups and downs of global oil prices that can affect Japan a lot.

The weak Japanese yen is a double-edged sword as the weak helps Japanese export companies but hurts Japanese import companies. The powers to be seem to be favoring the Japanese export companies, lately, as weak yen increases the price of Japanese products overseas, which at the same time increases Japanese current account, which essentially increases the money that the government can use and spend.

So the powers to be might not be favoring Japanese exporters they haven't done much about the weak Japan yen at this time to help Japanese importers or Japanese import prices.

To be fair, while every Prime Minister has tried to help the Japanese economy and help Japanese households, nothing recently has really helped even though they might have passed similar budgets with just short-term results but not a lot of long-term results.

And even though a new budget was passed it could take months to see any evidence of it helping the Japanese economy if at all.

Have a nice day!