Food prices index fell 1.1% for the month and increased 0.9% for the year to 100.6, housing was unchanged for the month and year at 99.8, while fuel, light and water charges gained 0.9% for the year and 2.2% from a year ago to 105.8.

Consumer prices for the Ku-area of Tokyo however rose 0.2% for the month and 0.4% from the previous month in December. Food prices increased 0.6% from November and 0.7% from a year ago. Housing prices were unchanged from November but increased 0.2% for the year at 100.2.

Food, light and water charges also increased 0.2% for the month and gained 1.6% from a year earlier.

Japan’s Ministry of Industry Trade and Economy said today that the number of employed increased 0.4% from a year ago in November to 64.33 million and the number of unemployed fell 5% from a year ago to 2.46 million.

METI statistics noted that labor force in the month stood at 66.79 million and people not in labor force were at 43.65 million.

Average monthly consumption for a household of two or more in November fell 0.6% to 282,836 yen, while average monthly income per household slid 1.5% in nominal terms and 2.1% in real terms from previous year to 435,640 yen.

In addition, expenditures declined 0.9% in nominal and 1.5% in real terms to 302,879 yen from a year ago.

METI reported that industrial production fell 1.6% from previous month and increased 2.9% for the year in November to a seasonally adjusted 110.4. Production is expected to rise 4.0% in December and to remain unchanged in January.

Inventories increased for the eleventh successive month by 2.5%.

Minister of Economy and Fiscal Policy Hiroko Ota said in Tokyo today inflation induced by high energy “may choke off spending by consumers and companies”.

Of the Nikkei 225 index stocks Takeda Pharmaceutical Company led gainers with a rise of 3.03% followed by gains in Nippon Oil Corp of 2.02%, in Mazda Motor Corporation of 1.64%, in Daiwa Securities of 1.40%, and in Kubota Corporation of 0.66%.

Japan Airlines led decliners in the Nikkei 225 stocks with a fall of 5.56% followed by losses of 4.57% in Chiyoda Corp, 4.43% in Meiji Seika, 3.80% in Mitsumi Electric Company, and 3.77% in Credit Saison Company.

Japan Airlines stock fell sharply on Nikkei reports it may sell its preferred shares to raise 150 billion yen. The carrier is reportedly seeking agreements with Mitsubishi Corp, Mitsui & Company and four other lenders by the end of March.

Financial stocks fell after Goldman Sachs said Citigroup, JP Morgan Chase, Merrill Lynch may write-down an additional $34 billion in subprime linked investments in the current quarter. Mitsubishi UFJ Financial Group fell 3.15%, Mizuho Financial Group slipped 2.91%, and Sumitomo Mitsui Financial Group declined 2.77%.

Exporters fell after U.S. orders for durable goods rose by a less-than-expected 0.1% in November. Canon edged down 2.62%, Toyota Motor Corporation fell 1.95%, and Sony tumbled 2.21%.

Bloomberg news reported today Mitsubishi Motor Corporation signed an agreement with the Russian government granting it incentives including reduced custom duties on imported auto parts to assemble vehicles in the country. Mitsubishi Motor Corp closed down 1.05%.



[R]5:00AM New York, 9:00PM Sydney - The Australia index lost 0.2% after loses in resource stocks.[/R]

ASX 200 index lost 0.2% or 11 to close at 6,339.90.