Broad gauge of inflationary pressures. The GDP Deflator is different from the Consumer Price Index in that it does not take into account changes in the prices of imports and tends to underestimate price changes. The Gross Domestic Product Deflator is also untimely, released quarterly about two months after the reporting period. Nonetheless, it is highly correlated with the CPI and a key indicator of inflation. Consequently, the deflator provides insight into the future direction of monetary policy as the Bank of Japan is inclined to raise interest rates when faced with higher inflation.
Specifically the deflator measures the magnitude of changes in prices for all domestically produced final goods. It is the ratio of output in current prices (nominal GDP) to inflation-adjusted output (real GDP). The headline value is the percentage change in the GDP Deflator from the previous quarter.
Relevance : Rarely affects markets
Release schedule : 23:50 (GMT); quarterly, two months after the reporting period.
Revisions schedule : Revised as GDP numbers are revised
Source of report : Economic and Social Research Institute ( Japan )
Web Address : http://www.esri.cao.go.jp/index-e.html
Address of Release : http://www.esri.cao.go.jp/en/sna/qe061-2/gdemenuea.html
AKA : GDP implicit price deflator
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