Source Ministry of Internal Affairs and Communications
This early data is thought to be the most important consumer inflation release.
The index monitors retail price changes for goods and services included into the consumer goods basket. The index calculation includes food and clothing prices, education expenditures, as well as prices for public health services, transportation, utility payments and leisure. The index is a monthly calculated value and is the basic indicator of the inflation rate in any country including the Japan.
CPI is considered to be the most important inflationary indicator.
The high rate of inflation raises the chances of the bank’s rate increase by the national Central Bank. Low inflation rate allows for more active economic stimulation by the Central Bank, and decreases the bank rate or applies quantitative easing in particular (when it is necessary).
Effect of market
Generally the index has a moderate influence on the Yen dynamics.