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Economy

Japan's inflation rate remains at 0.6% in July

Falling mobile phone fees and gasoline prices weigh on consumer index

Despite inching up for a 31st straight month, Japan's inflation rate remains stubbornly below the Bank of Japan's 2% target.   © Reuters

TOKYO (Kyodo) -- Japan's underlying inflation rate was unchanged at 0.6 percent in July, government data showed Friday, still far short of the Bank of Japan's goal of 2 percent.

The year-on-year gain in the nationwide core consumer price index, which excludes volatile fresh food prices, reflected higher utility costs, but falling mobile phone fees and gasoline prices weighed on the inflation rate, the Ministry of Internal Affairs and Communications said.

The core CPI rose for the 31st straight month, reaching 101.5 against the 2015 base of 100.

"There is no change in our view that (consumer prices) are on a moderate upward trend," a ministry official told a press briefing, adding that the government will closely watch the effects of crude oil prices on the index.

Energy costs increased 0.6 percent in the reporting month, with electricity and gas prices rising 2.7 percent and 3.0 percent respectively. Oil product prices dropped 2.7 percent, affected by a 4.3 percent decline in gasoline prices.

Prices for nonperishable foods grew 1.2 percent as ice cream shot up 6.9 percent in price on higher raw material and transportation costs, the ministry said.

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