By Mayumi Otsuma

Dec. 26 (Bloomberg) -- Japan's consumer-price inflation probably accelerated in November, matching the fastest pace in almost a decade, as oil costs surged.

Core consumer prices, which exclude fresh food, climbed 0.3 percent from a year earlier, according to the median estimate of 36 economists surveyed by Bloomberg News. Prices rose 0.1 percent in October, the first gain this year. The statistics bureau will publish the report on Dec. 28 at 8:30 a.m.

Faster inflation driven by rising costs probably won't prompt the Bank of Japan to raise the key interest rate from 0.5 percent in coming months because falling wages are eroding spending power. The bank last week cut its economic assessment for the first time in three years, saying growth is slowing.

``The current pickup in consumer-price inflation is not, in our view, the type that would prompt the Bank of Japan to raise interest rates,'' said Tetsufumi Yamakawa, chief economist at Goldman Sachs Group in Tokyo, who used to work at the central bank. ``The chance of a rate hike before the end of the fiscal year has virtually disappeared.''

Prices last rose 0.3 percent in August 2006. That was the quickest pace since March 1998, when an increase in the country's sales tax pushed gains to 1.8 percent.

Record energy costs are making it more expensive to travel in Japan. Tokyo's taxi operators this month raised fares for the first time in a decade, charging a minimum 710 yen ($6.20), up from 660 yen. All Nippon Airways Co., Japan's largest domestic airline, last week said it will raise some domestic fares from April 1.

Negative Effect

``We expect core prices to rise as much as 0.6 percent in March,'' said Masaaki Kanno, a former central bank official and now chief economist at JPMorgan in Tokyo. ``But unless they're accompanied by wage growth, the gains will have a negative effect on the economy.''

Japanese households last month became the most pessimistic they've been in almost four years as gasoline and food prices surged and wage growth stalled.

Wages have fallen in all but one month this year, making some retailers reluctant to pass on costs to consumers even as producers raise prices. Aeon Co., Japan's largest supermarket operator, last week said it will extend a price freeze on about 100 items, including yogurt and soy sauce, to the end of February from an initial deadline of Dec. 31.

``Declines in real incomes and costlier gasoline and kerosene prices are squeezing households,'' Aeon said in a statement released on Dec. 20.

Record Gasoline Prices

Gasoline climbed to a record 155.5 yen a liter on Dec. 10. Retail kerosene surged to the highest ever last week, according to the Tokyo-based Oil Information Center.

Price increases because of higher costs rather than an increase in demand from shoppers ``have an adverse effect on consumption, just like higher taxes,'' said Yasunari Ueno, chief market economist at Mizuho Securities Co. in Tokyo.

The increase in Tokyo taxi fares may be backfiring, as consumers used to a decade of deflation resist the increases. Daily revenue per taxi fell 3.6 percent from Dec. 3 to Dec. 9 from the same period last year, according to the Tokyo Taxi Association.

Japan's central bank held the benchmark overnight lending rate near zero for more than five years to overcome deflation. Policy makers raised the rate in July 2006 and doubled it to 0.5 percent in February. They've kept borrowing costs, still the lowest among major economies, on hold since.

Should oil resume falling, that may cause ``a temporary change in the course of consumer prices,'' a few central bank policy makers said at their Nov. 12-13 meeting, according to minutes released today.

Reports on industrial production, employment and household spending for November will also be released on Dec. 28.

Factory production slipped 1.7 percent from a record after export growth cooled, according to the median forecast of 37 economists surveyed by Bloomberg News. Analysts predict the unemployment rate to remain at 4 percent for a third month.

To contact the reporter on this story: Mayumi Otsuma in Tokyo at motsuma@bloomberg.net

By Julianna Goldman

Dec. 26 (Bloomberg) -- First, a Hillary Clinton supporter asked Bill Cobb if she could put a campaign sign in front of his Boone, Iowa, home. Then a backer of Barack Obama showed up. A few days later, a canvasser for John Edwards came by.

Signs for all three candidates now adorn Cobb's lawn, making it ground zero in a battle among Democratic presidential candidates to woo voters in Iowa's first-in- the-nation contests next month. With just 1,240 people having taken part in the caucuses in Boone County four years ago, the campaigns are competing for the support of even individual voters such as Cobb.

The relatively small numbers of voters involved in the caucus means the campaigns are putting a premium on on- the-ground organization because a close race will be decided by a candidate's ability to turn out the vote.

``Organization is key to winning the Iowa caucuses,'' said Gordon Fischer, a former chairman of the state Democratic Party and an Obama supporter. ``Because it is a caucus, people have to come out, date and time certain, and publicly declare their support for a candidate. In order to get people to make that kind of commitment, you really need to have a great ground game.''

Turnout

Caucuses make far greater demands of voters than primary elections, which usually only require the pull of a lever or push of a button to cast a ballot. On Jan. 3, Iowa caucus-goers will need to travel to their precincts, possibly through a snowstorm. Then, they will engage in a multiround process of public negotiation and cajoling with friends and neighbors --unlike the Republicans, who can keep their votes private -- that may last more than two hours.

How many people decide to make that commitment will depend on variables such as the weather and the participants' level of excitement about their choices.

The Democratic candidates are deploying unprecedented resources to ensure that Iowans turn out -- and champion their cause once the voting begins. The campaigns of Illinois Senator Obama, 46, and New York Senator Clinton, 60, have each fielded at least 300 paid staffers -- and many more volunteers -- to fan out across the state.

As in all Iowa's 99 counties, the votes in the Democratic stronghold of Boone remain up for grabs. To get an edge, the campaigns of the three leading Democrats have added their own arsenal of tactics to the standard campaign techniques of phone calls, mailings and door-to-door canvassing.

Softer Side

The Clinton camp is trying to capitalize on her support among women and emphasize her softer side. To do so, the campaign has relied on people like Georgina Cavendish, 21, who graduated from the University of Pennsylvania last year, then moved to Boone County this summer.

Cavendish has spent the time since forging deep connections with community leaders, organizing house parties and attending local Democratic committee meetings. She said she is now on first-name terms with many of the county's caucus-goers.

Clinton ``can't be in every community,'' said Cavendish. ``We're her ambassadors.''

On a recent Sunday afternoon Cavendish went door to door delivering copies of her candidate's endorsement by the Des Moines Register and leaving handwritten notes. She said that before canvassing, she tries to organize meet-ups at homes of older women who bake brownies for the campaign staffers and volunteers.

Younger Voters

Obama's campaign, meanwhile, is focusing on younger voters. Matt Kireker, a 2007 Princeton University graduate, has organized a 30-member ``Barackstars'' group at Boone High School, where most of the 200-member senior class is eligible to caucus, since 17-year-olds can participate as long as they turn 18 by Nov. 4, 2008.

Kireker said he isn't deterred by the fact that efforts to recruit these voters in past elections haven't translated into big turnouts at the polls. ``The idea that you only focus on previous caucus-goers is baloney,'' Kireker said.

The Obama campaign is also deploying college students on their winter break. On a recent Sunday, two such volunteers dropped in on a family brunch in Boone. Fifteen minutes later, the dozen likely caucus goers said they were leaning toward Obama. Every one of them would receive a follow-up phone call, Kireker said.

Building on '04 Support

Edwards, a former North Carolina senator, is focusing on the support he built among rural and union workers when he ran for the Democratic nomination in 2004 and split the county's vote with Massachusetts Senator John Kerry.

As a rural area, Boone is fertile ground for Edwards, 54, who has campaigned in the county more than any other candidate, said Cheri Johnsen, a campaign volunteer and precinct captain in Madrid.

She said she delivered policy books to people's doors, including homes in remote areas. The campaign is also distributing a DVD about the ``systematic neglect'' of rural America.

Cobb, a railroad engineer, said that while his union has endorsed Clinton, he likes Obama's oratorical skills. For now, though, he is leaning toward Edwards, whom he sees as the ``toughest'' candidate to take on a Republican in November.

``We're confused,'' said Cobb, 57.

To contact the reporter on this story: Julianna Goldman in Des Moines, Iowa at jgoldman6@bloomberg.net .

Etihad Airways to sponsor Abu Dhabi Grand Prix

Etihad Airways has signed a three-year deal to become the title sponsor of the Abu Dhabi Grand Prix, which will start with the inaugural race in 2009. The event will be officially known as the FORMULA 1™ Etihad Airways Abu Dhabi Grand Prix. “To have secured the title sponsorship for the inaugural FORMULA 1™ Abu Dhabi Grand Prix and beyond is a tremendous honour for Etihad Airways and will enable the airline to increase its reach to a global audience,” said James Hogan, Etihad Airways’ chief executive. “The ‘2009 FORMULA 1™ Etihad Airways Abu Dhabi Grand Prix’ will be an historic occasion for the UAE’s capital and Etihad looks forward to welcoming thousands of F1 spectators from across the world to Abu Dhabi.” Welcoming the Etihad Airways announcement, Formula One Group CEO Bernie Ecclestone said: “Securing a title sponsor of this calibre two years out from the first event is further reinforcement that the region is full of excitement and anticipation for the Abu Dhabi Grand Prix.” The race will take place on a new 5.6-kilometre circuit currently being built on Yas Island, a natural 2,550 hectare island situated on the east coast of Abu Dhabi. The track, designed by Hermann Tilke, will be one of the longest and most demanding circuits in the world.