Data published by the Ministry of Internal Affairs and Communications showed that in November the unemployment rate was 2.5%, unchanged from October and confirming economists' forecasts. The latest reading is the lowest since January. The number of employed increased by 560,000 to 67.8 million, while the number of unemployed rose by 40,000 to 1.69 million. Meanwhile, the jobs-to-applications ratio fell to 1.28 from 1.3 in October, reaching its lowest level since June 2022.
A separate report from the Bank of Japan showed that services producer price inflation increased in November by 2.3% per annum, as in October. On a monthly basis, PPI services growth slowed to 0.2% from 0.5% in October. Overall, the latest data signals that rising service prices will start to replace cost-push inflation as a key driver of price gains, and help achieve its 2% inflation target on a sustainable basis. Yesterday, the head of the Bank of Japan, Kazuo Ueda, said that the probability of achieving the inflation target is "gradually increasing" and that next year's wage forecast is key to determining the timing of abandoning ultra-loose monetary policy.
Also today, the Bank of Japan reported that core inflation eased to 2.7% in November from 3% in October. A similar lower rate was last reported in February.