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Japan's wholesale inflation slows for 6th straight month

Published 07/11/2023, 08:06 PM
Updated 07/11/2023, 09:07 PM
© Reuters. Shoppers look at packs of sugars at a luxury food store in Tokyo September 25, 2014 REUTERS/Yuya Shino/File Photo

By Leika Kihara

TOKYO (Reuters) - Japan's wholesale inflation slowed for a sixth straight month in June due to sliding fuel and commodity prices, data showed on Wednesday, a sign the cost-push pressure that drove up consumer prices is steadily easing.

The data underscores the central bank's view that consumer inflation will slow in coming months as global commodity prices slide from last year's peak levels.

"Sectors like beverage and food makers continue to pass on higher raw material costs. But the pace appears to be moderating," Masato Higashi, head of the Bank of Japan's price statistics division, told a briefing.

The corporate goods price index (CGPI), which measures the price companies charge each other for their goods and services, rose 4.1% in June from a year earlier, data showed, slower than a median market forecast for a 4.3% increase.

The rise, which followed a 5.2% gain in May, was the slowest annual pace since April 2021, data by the BOJ showed.

The main factor behind the slowdown was utility and gas bills which rose 5.3% in June from a year earlier, much smaller than a 12.8% gain in May. Food and beverage prices increased 7.4% in June, smaller than a 8.0% gain in May, the data showed.

© Reuters. Shoppers look at packs of sugars at a luxury food store in Tokyo September 25, 2014 REUTERS/Yuya Shino/File Photo

The yen-based import prices fell 11.3% in June from a year earlier, the biggest annual drop since July 2020, offering some relief for retailers heavily reliant on raw material imports.

The BOJ has stressed its resolve to maintain ultra-loose monetary policy until the recent cost-driven rise in inflation shifts to price gains driven by robust domestic demand, and accompanied by higher wages.

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