Japan Inflation Rose to 1.9 Percent, With June at 1.6 Percent on the New CPI Base
Japan’s consumer price index rose 1.9 percent in the year to July, with the all-items index at 102.0 against a 2025 average of 100.
The number arrived with a methodological change attached. July is the first monthly national CPI published on Japan’s new 2025 base, which means the figure most readers are holding for June — 1.7 percent — is not the right thing to compare it against.
On the new base, June was 1.6 percent. The acceleration into July is therefore three tenths of a point, not the two tenths a mixed-base comparison would show.
What the rebasing did, and how much of it was real
The Statistics Bureau published the retrospective series on 7 August, restating every month from January 2025 to June 2026. From January to May 2026 the two bases produced the same headline rates at published precision. June was the exception, moving from 1.7 percent on the 2020 base to 1.6 percent on the 2025 base.
The more interesting number is underneath it. The Bureau decomposes the June difference between the two bases as a total contribution gap of just minus 0.03 percentage points, made up of:
| Effect | Contribution |
|---|---|
| Weight effect | +0.10 |
| Reset effect | −0.15 |
| Model formula effect | 0.00 |
| Item revision effect | +0.02 |
| Total | −0.03 |
So the visible tenth partly reflects where a three-hundredths contribution difference falls when the published year-on-year rate is rounded to one decimal place. Underneath that result, substantial effects worked in opposite directions: updated expenditure weights added 0.10 percentage points, while the reset effect associated with updating the index reference period subtracted 0.15 points.
That is a more precise account than saying the measurement changed. It says which part of the measurement changed, and by how much.
The comparison on a consistent basis
| Measure | June 2026, 2025 base | July 2026 | Change |
|---|---|---|---|
| All items | 1.6% | 1.9% | +0.3 pp |
| Less fresh food | 1.6% | 1.8% | +0.2 pp |
| Less fresh food and energy | 1.7% | 1.9% | +0.2 pp |
July index levels on the 2025 base: all items 102.0, less fresh food 102.1, less fresh food and energy 102.1.
The June figures for the two core measures were unchanged by the rebasing — both printed the same on the old base and the new one. Only the headline moved.
The three July readings sit within a tenth of each other. That tells us removing fresh food and energy makes little difference to the aggregate rate. It does not establish that price rises were broad across the basket — that question needs the July component contributions or a distribution measure, and neither is available yet. The proximity of three exclusion measures is not evidence of breadth, and it should not be read as such.
On the policy framing: the Bank of Japan defines its 2 percent target in terms of the consumer price index and treats all-items CPI as the basic indicator. It pays particular attention to CPI excluding fresh food and to CPI excluding fresh food and energy, alongside trimmed mean, weighted median, mode and diffusion index measures. Two of those are in the table above; the rest are not yet published for July.
The basket changed as well
Rebasing resets the index to 100 and updates the expenditure weights.
Food’s weight rose from 2,626 to 2,754 out of 10,000, taking its share of the basket from 26.26 to 27.54 percent. Clothing and footwear went the other way, from 353 to 299, or 3.53 to 2.99 percent.
All else equal, food price movements now move the headline index more than they did, and clothing less. Those shifts illustrate the reweighting captured by the Bureau’s weight effect — though the +0.10 percentage point figure in the table above is the net result of weight changes across the full basket, not of food and clothing alone.
The Bureau also extended point-of-sale data collection to memory cards and printer ink cartridges. The effect is negligible — in the June comparison, memory cards accounted for 0.01 percentage points of contribution difference and printer ink for effectively nothing.
Where July sits
Japan’s July trade figures and this month’s producer price release, both of which we have covered, set out the upstream cost position. Today’s consumer reading is the downstream measure.
What it does not yet permit is a conclusion about pass-through. Establishing how much upstream cost has reached households requires the July component contributions — energy, electricity, fuels, food excluding fresh food, services — and those are not out. Transmission can also be delayed, or absorbed through margins, the exchange rate and administered prices. The headline acceleration is clear. Its composition is not, and is worth waiting for rather than assuming.
Two technical points worth keeping
The Bureau recalculated index levels back to January 2025 and provides a linked index so earlier levels can be compared across the boundary. It does not recalculate rates of change through that link — the rates published under each base are carried as published, and the 2025 change rates were not restated at all. The linked series bridges levels, not growth rates. Computing year-on-year rates straight across the link produces numbers the Bureau does not stand behind.
Second, and useful for the months ahead: the Bureau will continue calculating and releasing the 2020-base CPI through December 2026. That creates six months of parallel observations, July through December, allowing the effect of the new weights and methodology to be observed directly rather than inferred. Anyone building a continuous series should also note that seasonal adjustment has moved to the latest X-13ARIMA-SEATS software, so seasonally adjusted figures from the two bases should not be mechanically spliced.
Sources
- Statistics Bureau of Japan, 2025-base Consumer Price Index, national, July 2026, published 21 August 2026
- Statistics Bureau of Japan, Retrospective Results under the 2025-base Consumer Price Index Revision, published 7 August 2026
- Statistics Bureau of Japan, Main Points of the 2025-base Revision
- Statistics Bureau of Japan, 2025-base revision reference pages, linked index and retrospective methodology
- Bank of Japan, price stability target and underlying inflation indicators
