People wearing face masks walk along a pedestrian crossing at Shibuya district, on Dec. 17, 2021, in Tokyo. (AP Photo/Eugene Hoshiko)
TOKYO (Kyodo) -- Japan's core consumer prices gained 0.5 percent in November from a year earlier, the highest increase since February 2020, pushed up by surging energy costs and a weak yen, government data showed Friday.
The core consumer price index, excluding volatile fresh food items, marked the third straight month of growth, according to the Ministry of Internal Affairs and Communications.
In February last year, the figure, a key gauge of inflation, increased 0.6 percent.
Much of the gain in the November core CPI came from higher energy and raw material costs on the back of the weak yen, though the Bank of Japan is still far from achieving its 2 percent inflation target.
Energy prices gained 15.6 percent, the largest increase since August 2008, the ministry said.
Kerosene prices jumped 36.2 percent from a year ago and gasoline surged 27.1 percent, reflecting higher crude oil prices. Electricity bills, which track crude oil prices with a lag, rose 10.7 percent.
Sharply lower mobile phone fees, down 53.6 percent in the reporting month, introduced earlier this year amid government pressure to ease the burden on consumers, were a major drag, helping limit the rise in the headline inflation figure.
"It's easy for energy and food companies to pass on higher costs quickly to consumers," said Toru Suehiro, a senior economist at Daiwa Securities Co. "Beyond such items, price hikes have not spread, especially in the services sector hit by the pandemic."
Japan has seen prices rising only moderately compared with other nations such as the United States, which marked the sharpest gain in around four decades of 6.8 percent in November.
Despite upward pressure from commodity prices, Japan's inflation is expected to remain low, giving the BOJ reason to maintain its easy money policies and diverge from its U.S. and European peers, which are moving toward dialing back crisis-mode stimulus.
A ministry official said prices are "rising steadily" in Japan, where the BOJ projects the core CPI to rise 0.9 percent in fiscal 2022 starting in April.
"The worry is that such items as energy and food are closer to people's daily lives so higher prices can hurt sentiment among consumers. They may start feeling that it's bad inflation accelerated by yen weakness at a time when economic conditions are not good," Suehiro added.
Japan's COVID-19 state of emergency was lifted in October, allowing economic activity to pick up. Accommodation fees continued to surge in November, up 57.6 percent from a year ago when the government's subsidy program to rejuvenate regional tourism in the nation led to sharp discounts.
Excluding both fresh food and energy items, the so-called core-core CPI fell 0.6 percent, down for the eighth straight month.
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