The research team at BBH suggests that Japan’s end of the month data dump shows why many expect the BOJ to lag behind the ECB as the March CPI was a touch softer than expected at 0.2%, and the core rate was steady at 0.2%.
“Excluding food and energy, CPI slipped back into negative territory (-0.1% vs. 0.1%). Although retail sales ticked up in March (0.2%), overall household spending disappointed. It fell 1.3% year-over-year, which was more than twice the expected pace, though not as deep as the decline in February.”
“Industrial output was also weaker than expected, falling 2.1% in March, which gives back more of February’s 3.2% gain than expected. The median expectation was for a 0.8% decline. Lastly, unemployment was unchanged at 2.8%, though the jobs-to-applicant ratio increased to 1.45 from 1.43.”