Japan’s Inflation Hits Four-Decade High

Japan’s inflation has hit a four-decade high as prices rose at their fastest pace since 1981 in November, data showed on Friday.

The core inflation climbed 3.7 per cent last month compared with a year earlier, according to data released by Japan’s internal affairs ministry.

The Bank of Japan (BOJ) stunned markets on Tuesday by allowing long-term interest rates to rise more.

BOJ Governor Haruhiko Kuroda has said the bank had no intention to roll back stimulus as inflation was set to slow below two per cent next year.

Japan’s parliament last Friday approved a hefty 29 trillion yen ($216 billion) budget aimed at countering inflation.

The extra spending, funded mainly by government bonds, is considered to help boost the economy but has added to concerns over the already heavy national debt.

The latest stimulus package will provide about 5,000 yen ($37) in monthly subsidies for household electricity and gas bills, totalling about 6 trillion yen ($45 billion).