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The
reshuffle, which takes place once every five years, removes
items from the basket that consumers are spending less on and
replaces them with items that shoppers are buying more often.
Wine glasses also make way for cheap take-away coffee sold at
Japan's ubiquitous convenience stores in a sign that people
prefer a pick-me-up to get them through a busy day over relaxing
with a glass of red at the end of one.
Japan has the highest percentage of people aged 65 or more among
countries belonging to the Organisation for Economic Cooperation
and Development. Japan also has one of the lowest fertility
rates in the OECD, and its graying demographics are changing
consumption.
Consumer prices are a hot topic in Japan because the country's
central bank has launched a massive quantitative easing program
to guide inflation to 2 percent and vanquish the risk of
returning to deflation.
However, core inflation, which excludes fresh food but includes
energy, is hovering at just 0.1 percent and the pessimists say
it could take years for the central bank to hit its price
target.
The Ministry of Internal Affairs, which compiles CPI, will
remove 32 items in total from the basket and add 33 new items,
according to a proposal on its website. Once the revisions are
complete, there will be 585 items in the basket.
The ministry will also adjust the weights assigned to each item
based on fourth-quarter household spending data.
This change could see an increase in weighting for utilities and
household renovations, but the weight of flat-panel TVs could be
reduced.
Once finalised, revisions to the CPI basket will take effect for
data from July 2016, the ministry said.
(Reporting by Stanley White; Editing by Jacqueline Wong)
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