Factory output rose for a third straight month, retail sales jumped and job availability hit a six-year high, other data showed on Friday, adding to growing signs that the recovery in the world's No. 3 economy is gathering momentum.
Friday's data showed progress towards the central bank's target of 2% inflation by around 2015. But achieving that goal could prove challenging when prices lose support from a weak yen in year-on-year comparisons next year. Whether employers increase wages, which have barely risen for years, remains key, analysts say.
The core consumer price index, which includes oil products but excludes volatile costs of fresh food, rose 1.2% in November from a year earlier, government data showed.
And in a sign of broadening inflation, the so-called core-core inflation index which excludes food and energy prices rose 0.6% in the year to November. That marked the second straight month of gains and the biggest increase since August 1998. Factory output rose 0.1% in November, less than a median market forecast for a 0.4% increase, although manufacturers surveyed by the government expect production to rise in December and January.
Japan's economic growth slowed in the third quarter due to soft exports after outpacing its G7 counterparts in the first half of this year. In other data on Friday, wage earners' total cash earnings rose 0.5% year-on-year in November, up for the first time in five months in a sign that upward momentum for salaries is starting to pick up. Regular pay, which excludes overtime and special payments like bonuses, was flat, the first time it has stopped falling in 18 months.
In a sign of a tightening job market, the jobs-to-applicants ratio improved to 1.00 in November, meaning one job was available for each job seeker, from 0.98 in October.
Retail sales rose 4.0% in November from a year earlier, exceeding the median forecast for a 2.9% increase, partly due to demand ahead of a planned increase in the sales tax next year.