Japan's core CPI rose 0.4% in June, the first rise since April 2012, and the biggest gain since November 2008. Abenomics starting to work? Not so fast.
While the headline makes it appear that the Bank of Japan's massive monetary easing is starting to create inflationary pressure, the reality is that much of gain came from higher costs for imported energy.
So it's really yet another example of how an out of control central bank such as the Fed can thwart another out of control ventral bank, simply by exporting higher prices (which are tied to the world's reserve currency: the dollar). Not exactly spreading goodwill around the world.
The Nikkei plunged nearly 3%.
S&P futures are down in sympathy, but nowhere close. They will, however, put pressure on the 1685.04 level that I was using as a stop yesterday afternoon.
Below that level there could be a test of 1671.84. If the market remains above it, there is a chance for yet more highs.
Wow, Mick Jagger turns 70 today. Still rocking. Hope he gets a free drink at Basil's in Mustique.
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