Tokyo Inflation Falls Below 2%

(RTTNews) - Inflation in Japan's capital Tokyo fell below 2 percent for the first time since May, data from the Ministry of Internal Affairs and Communications showed Friday.

Excluding fresh food, consumer price inflation weakened to 1.8 percent in October from 2.0 percent in September. Inflation was seen at 1.7 percent. The rate fell below 2.0 percent for the first time in five months.

Likewise, overall consumer price inflation slowed to 1.8 percent from 2.1 percent a month ago.

Further, inflation excluding fresh food and energy also stood at 1.8 percent, up from 1.6 percent a month ago.

The Bank of Japan is set to announce its monetary policy decision on October 31. The bank had signaled that a hike is unlikely this month. The bank was widely criticized for poor communication when it lifted the rate in July.

The timing of the next rate hike is highly uncertain for now, but the BoJ is expected to raise its policy rate to 1.0 percent by the end of next year, ING economist Min Joo Kang said. Elsewhere, data from the Bank of Japan showed that corporate services producer prices index advanced 2.6 percent on a yearly basis in September after an increase of 2.8 percent in August.

On a monthly basis, the services PPI edged down 0.1 percent after staying flat in August.