Japanese Finance Minister Aso crossing the wires, reported by Returns to have said, “don’t expect big pullback in demand after the sales tax hike.”
This follows Japan recently increasing its consumption tax for the first time in five years, bringing the long-delayed policy into effect despite concerns it may knock the economy.
Japan raised its sales tax rate from 8% to 10 and the new rate applies to nearly all goods and services, though most food will be exempt. However, the news has little bearing on the Yen at this stage with markets having already priced it in.
Earlier today, the Core consumer prices in Tokyo, a leading indicator of nationwide inflation, rose 0.5% in October from a year earlier, staying distant from the Bank of Japan’s elusive 2% target and keeping it under pressure to ramp up stimulus.
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