TOKYO: Japan's consumer prices fell 0.3 percent in February year-on-year, official data showed Friday, underlining the tough task the government faces in pulling the economy out of its deflationary spiral.
The reading was slightly better than a forecast by economists surveyed by Dow Jones Newswires and the Nikkei, who estimated a drop of 0.4 percent.
In January, the index -- which excludes fresh food -- dropped by 0.2 percent on year. February's fall is the fourth straight month of declining prices.
Prime Minister Shinzo Abe, who took office in December, vowed to pull the world's third-largest economy out of years of deflation.
New Bank of Japan governor Haruhiko Kuroda has pledged to achieve a two percent inflation target in two years.
Deflation is bad for the economy because it encourages consumers to put off spending in the belief their intended purchases will be cheaper in the future, softening demand and hurting producers.
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