Rampant food inflation at a 31 year high in Japan

Food prices in Japan are rising fast as producers struggle to cope with a depreciating Yen and the increasing costs of commodities. 

Data collected from supermarkets and other food retailers show food inflation is currently at 4.5% on the year. It is moving so fast though that sellers are barely able to keep up. 

Whilst 4.5% sounds relatively modest, amongst that average are some significant hikes – the price of cooking oil for example up 23%, dried pasta up 17.1% and Mayonnaise up 16.7%. 

The rising prices are forcing consumers to rethink their spending habits, with low-income households disproportionately affected – reducing their consumption significantly. 

THINK LIKE AN ECONOMIST!

Q1. Define the term inflation

Q2. Explain what is causing the soaring food inflation in Japan.

Q3. Analyse the impact of a depreciating Yen on domestic food prices. 

Q4. Discuss the view that low-income households are disproportionately affected by increasing levels of inflation

Click here for the source article

TheCuriousEconomist

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