TOKYO (Reuters). Tokyo consumer inflation is expected to slow in January. The poll was conducted after a suspension in December 2020 of a government discount travel campaign. It has resulted in a less favorable situation for price hikes.

However, the core consumer price index in the capital, widely thought to be a key indicator of national trends in prices, remained in positive territory for the fifth month. This is despite the fact that they were not affected by 2020’s low comparison base due to discount travel deals.

According to 16 economists, Tokyo’s core consumer prices index (CPI), which excludes energy, is expected to increase 0.3% in January.

It would represent the slowest pace of growth in Japan’s core CPI capital since November’s 0.3% increase.

In a note, economists from SMBC Nikko Securities stated that while energy and food prices are likely to rise further due to rising import costs being passed on, these gains will be offset with special downside factors.

After a spike in COVID-19-related cases in December 2020, a government campaign offering discounts to consumers for overnight stays was stopped in December 2020. This likely resulted in less price pressure in the first half of last year and slowed year-on year growth.

Due to the rise in global commodity prices this week, Bank of Japan (BOJ), has upgraded its inflation forecasts. This is primarily because more companies are trying to pass higher costs onto consumers.

Minutes from the December BOJ policy meeting, released Friday, showed that some board members suggested that Japanese companies may be becoming more aggressive.

Data for January Tokyo CPI will be released by the government on Jan. 28th at 8:30 am (Jan. 27, 2330 GMT).