Japan's
wholesale prices dropped 2.9 percent from the previous year in 2015, marking the first decline in three years, as concerns about a
China
-led slowdown sent crude oil and other material costs sharply lower, the
Bank of Japan said Thursday.
The index of corporate goods prices stood at 99.9 last year against the 2010 base of 100, the BOJ said in a report.
Falling crude oil prices have clouded the outlook for the central bank to achieve its inflation target of 2 percent around the second half of fiscal 2016.
By product, prices for petroleum and coal products marked a 24.1 percent year-on-year drop, while those for chemical products were down 7.4 percent.
The yen's weakness, however, translated into higher prices for food, transport equipment and other prices.
Prices of food, beverages, tobacco products and foodstuffs were up 0.9 percent, while those of transport equipment gained 0.3 percent.
In December alone, the index fell 3.4 percent from a year earlier for the ninth straight month of decline to 101.1.
Going forward, a BOJ official said the recent plunge in crude oil prices will likely have a spillover effect on other prices.
"The recent firming of the yen could also put downward pressure on prices," the official said.
Prices for petroleum and coal products dropped 22.7 percent from a year earlier, and those of nonferrous metal products fell 12.6 percent. Scrap and waste prices also saw a sharp fall of 32.0 Percent amid concerns about the Chinese economy.
A seasonal factor helped lift prices of agriculture, forestry and fishery products such as beef and pork, supported by strong demand for hot-pot dishes.
Export prices dropped 6.9 percent and import prices slid 18.5 percent, both in yen terms.
The price index dropped 0.3 percent on a month-on-month basis in December for the seventh monthly decline.
==Kyodo
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(January 13, 2016 - 12:16 PM EST)
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