Japan CPI at 1.3 percent, factory output steady

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TOKYO -- Japan's consumer price index rose 1.3 percent in January, as inflation picked up pace though most of the increase was due to higher energy costs.

Data released Friday show the recovery in the world's third-largest economy held steady in January, with factory output up 4 percent from December. The figures were in line with forecasts.

The government and central bank have unleashed a flood of stimulus aimed at breaking Japan free from a long spell of deflation, or falling prices, that is thought to discourage investment and spending.

Excluding both food and energy prices, consumer prices rose 0.7 percent in January.

Economists have forecast a jump in demand ahead of an April 1 sales tax hike, with a contraction to follow as consumers and businesses adjust to higher costs.

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