More signs Abenomics is working as Japan prices, output rise | Reuters - 1 views
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core consumer prices posted their biggest rise in nearly five years, unemployment fell to its lowest since late 2008, factory output rose and is expected to rise further, and workers' incomes rose.
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The core-core inflation index, which excludes food and energy prices and is similar to the core index used in the United States, was down 0.1 percent in the year to July, a slower pace of decline than June's 0.2 percent fall.
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Household spending edged up in the year to July as the feel-good sentiment prompted consumers to eat out more and spend more on travel and leisure.
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As the economy strengthens, the debate is focused on whether to double the tax in two stages or increase it more gradually, rather than whether or not to increase the tax.
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Wage-earners' incomes also rose an annual 1.3 percent in July, increasing for the fifth straight month.
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And the jobless rate improved for the second straight month to hit 3.8 percent in July, the lowest since October 2008.
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e Bank of Japan have gambled on massive fiscal and monetary stimulus to spark life into the economy,
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strengthening the case for a planned sales tax increase.
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Pessimists have argued that the benefits of "Abenomics," a three-pillar strategy of fiscal and monetary stimulus combined with a long-term growth strategy, may be short-lived and won't prompt companies to spend more on investment and wages.
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The Bank of Japan has a target of lifting inflation to 2 percent in about two years, a goal many analysts see as optimistic given the deflation that has dogged the economy.
