Japanese inflation slows

Inflation in Japan has fallen further in October by 1.9 percent, as official reports have indicated that due to the reduction in oil prices and energy prices, it is hoped that the economy will soon pick up.

The problem is that October has been the continued fall of consumer spending which has been on the decline for eight consecutive months, coupled with the fact that the jobless rate increased more than expected.

Retail sales have suffered, even though retailers have spent heavily on advertising during the period.

According to the Statistics Bureau, consumer prices increased by 1.9 percent from last year, which is slower than the 2.3 percent experienced in September.

Industrial production and output has stuttered as orders are diminishing, which may mean that further job cuts may be just around the corner in 2009.

The yen is currently trading at 95.42 per dollar from 95.41, although the yen has increased in value by 11 percent against the dollar since the start of September, which has made imported goods cheaper.

As a result, some retailers have been able to take advantage of the strength of the yen and benefit from cheaper raw materials in order to stimulate consumer spending, which is such an integral part of the Japanese economy.

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