core consumer prices flat in February in Japan

That the measure "is probably a reflection of the rapidly widening output gap, which shows that deflation will worsen in the coming months and to persist for several months," Macquarie Group economist Richard Jerram wrote in a report.
"We calculate that risk reduction is higher than ever," Jerram said, adding that "the main problem with deflation is to prevent the Bank of Japan cutting real interest rates enough to economic recovery."
"After pushing down the interest rate is almost zero, easing policy from here is difficult. BOJ make matters worse in the tolerance of deflation, the comments from officials and in the policy framework, as this reinforces the hope that he will be allowed to persist, "Jerram said.
However, Japan's Finance Minister Kaoru Yosano told reporters Friday that it was too early to say deflation in Japan is, according to Reuters reports.
Data early March core consumer prices in the Tokyo metropolitan area, which functions as a leader for the national consumer price indicator, showed an increase of 0.4% from the previous years. Last month, the measured data increased 0.6%.
The data came a day after Bank of Japan reported 2.6% decline in the year in the country's corporate service price index for February, behind the 9% decrease in prices paid by transport companies of Japan.