The Ministry of Internal Affairs and Communications said on its website the core consumer price index in March, excluding fresh foods, was 99.5 against the 2010 base of 100, down 0.5 percent from the same month of last year. The overall price drop for March was 0.9 percent.
The March numbers were the fifth straight month of decline. In February, the core price index was off 0.3 percent year-on-year.
The government of Prime Minister Shinzo Abe has made it a top priority to lift the economy out of years of deflation through a number of stimulus measures. Japan's central bank, Bank of Japan, recently doubled its inflation target to 2 percent as part of that effort.
The stimulus measures have brought down the value of the yen against other major currencies, which should help boost exports, officials said.
The appointment of Haruhiko Kuroda as governor of the central bank is expected to lead to more monetary easing to boost the economy. Kuroda this month introduced a set of new monetary easing steps, including additional purchases of government bonds and risky financial assets.
Kyodo News, quoting analysts, said consumer prices may start rising this summer due to the yen's slide and higher energy prices. The world's third-largest economy after the United States and China could also benefit with a pickup in the global economy and domestic electric rate hikes, the analysts said.
"With the economy both at home and abroad, the pace of consumer prices is expected to trend upward more strongly," said Takeshi Minami, chief economist at the Norinchukin Research Institute.
Some recent data have signaled consumer prices would go up, as inflation expectations have been growing amid hopes for economic recovery, Kyodo said.
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