The Real Rate of Inflation In Japan: Official Numbers vs. BOJ Correction For Subsidies
As I detailed in this post, the Bank of Japan (BOJ) is now regularly releasing figures that correct the official consumer inflation numbers to account for subsidies. For example, when the government subsidizes gasoline prices, inflation goes down. But that just changes who pays the cost. So, the BOJ publishes numbers showing what inflation would be without the additional subsidies. The latter is the number that helps guide interest rate decisions, such as the one to be made next Tuesday. There are a few different measures: all prices, prices ex-fresh food, prices ex fresh food and energy, and prices ex all food and energy. They’re giving mixed messages.Here’s what it looks like so far this year
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