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Japan's core consumer prices fell for a fifth straight month and marked the biggest annual drop in more than three years in July, government data showed on Friday, keeping the central bank under pressure to expand an already massive stimulus program.

The gloomy data reinforces a dominant market view that premier Shinzo Abe's stimulus programs have failed to dislodge the deflationary mindset prevailing among businesses and consumers.

The nationwide core consumer price index, which includes oil products but excludes volatile fresh food prices, fell 0.5 percent in July from a year earlier, more than a median market forecast for a 0.4 percent decline.

The fall was slightly bigger than a 0.4 percent drop in June.

Core consumer prices in Tokyo, available a month before the nationwide data, fell 0.4 percent in August from a year earlier, more than a median market forecast for a 0.3 percent drop.

Starting from this release, the government changed the base year for the price indices to 2015 and changed the components making up the indices to better reflect consumer spending trends in an overhaul it conducts once every five years.

Japan's economic growth ground to a halt in April-June and analysts expect any rebound in the current quarter to be modest as weak global growth and the yen's 20 percent rise against the dollar so far this year hurt exports and capital expenditure.

Despite three years of heavy money printing by the BOJ, weak household spending and a strong yen pushing down import costs have kept inflation distant from the bank's 2 percent target.

Markets are simmering with speculation the BOJ will ease monetary policy further at its next rate review in September, when it conducts a comprehensive review of the effects of its existing stimulus program.

First Published:Aug 26, 2016 8:21 AM IST