TOKYO (Reuters) – Japan’s wholesale inflation slowed for the fourth month in a row in April as raw material price gains slowed and consumer inflation hit the central bank’s 2% target, data on Monday showed. It was suggested that it will begin to return gradually toward
The data could discourage market hopes that rising inflationary pressures will prompt the Bank of Japan to exit ultra-low interest rates sooner.
The Corporate Goods Price Index (CGPI), which measures the prices that businesses charge each other for goods and services, rose 5.8% in April from a year earlier, marking the fourth straight month of slowing annual gains, according to data from the Bank of Japan.
The increase was above the median market forecast of 5.4% and followed a 7.4% increase in March.
“Many firms have yet to fully pass on past increases in input costs, and given the significant wage increases agreed in wage negotiations with unions this year, firms will likely pass on higher labor costs. There is a possibility that we will raise the price because of this,” said chief Mr. Namtake. Norinchukin Bank economist.
“That said, price growth is likely to slow as import-led inflationary pressures are already subsiding.”
The yen-denominated import price index rose 9.6% after a revision in March, before falling 2.9% in April from a year earlier, a sign that import costs for fuel and raw materials had peaked, the data showed.
Analysts are watching wholesale prices, which are seen as a leading indicator of consumer price developments, for clues as to whether consumer inflation will rise enough for the BOJ to phase out large-scale stimulus measures. there is
Japan’s core consumer inflation rate hit 3.1% in March, and the index, which excludes fuel costs, rose at its fastest annual pace in 40 years in a sign of rising price pressures.
Bank of Japan Governor Kazuo Ueda said the central bank would keep monetary policy ultra-accommodative unless the recent rise in consumer inflation is further driven by strong domestic demand and accompanied by higher wage growth.
Report by reporter Leica Kihara.Editing: Kim Coghill
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