"The prevailing atmosphere shows no clue on when inflation will rise into positive territory and stay there"
- Daisaku Ueno, a senior foreign-exchange and fixed-income strategist at Mitsubishi UFJ Morgan Stanley
Japanese corporate service price index fell more than expected in August, posting a third straight drop, the Bank of Japan said on Tuesday. Nation's CSPI, which is a leading indicator of consumer inflation, fell to a seasonally adjusted annual rate of -0.3% from the previous month, after falling a revised 0.1% in July. The reading came in lower than the median analyst forecast of -0.2%.
"The prevailing atmosphere shows no clue on when inflation will rise into positive territory and stay there," said Daisaku Ueno, a senior foreign-exchange and fixed-income strategist at Mitsubishi UFJ Morgan Stanley in Tokyo.
"Looking at both domestic demand and overseas economies, I don't expect the economy to slide back into a recession but I cannot say it will stage a recovery either," said Yasuo Yamamoto, senior economist at Mizuo Research Institute in Tokyo.
The Nikkei 225 Stock Average tumbled 2.03 per cent, or 184.84 points, to 8,906.70. The broader Topix Index erased 2.00 per cent, or 15.12, to 742.54.
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