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"Economic recovery takes a break," said a headline in Friday's edition of the financial newspaper Nikkei Shimbun. Excluding food and energy costs, the inflation index was flat, the first time since 2008 that measure has not fallen. Japanese consumers are facing price hikes for a wide array of items, including most food products. Fresh food prices rose 11 percent in September from a year earlier, including a 58 percent increase in the price of cucumbers. Gasoline prices rose 9 percent and electricity rates 7.6 percent, for a 5.4 percent increase in overall utility rates. Price increases for other consumer goods, housing and services have remained weak, however, due to competition and oversupply. Wage increases, key to stimulating consumer demand, have been slow in coming. Major labor groups say they plan to push for more than 1 percent increases in base wages in spring labor negotiations next year, for the first time in five years. But any increase in average incomes is likely to be more than offset by price and tax hikes.
[Associated
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