By Leika Kihara
TOKYO (Reuters) -Japan's wholesale inflation accelerated in June as the yen's declines pushed up the cost of raw material imports, data showed on Wednesday, keeping alive market expectations for a near-term interest rate hike by the central bank.
Rising global commodity costs and a phase-out of gasoline and fuel subsidies also pushed up wholesale prices, the data showed, a sign of heightening inflationary pressure.
The data will be among factors the Bank of Japan (BOJ) will scrutinise at its next policy meeting on July 30-31, when the board will release fresh growth forecasts and debate whether to raise interest rates from current near-zero levels.
The corporate goods price index (CGPI), which measures the price companies charge each other for their goods and services, rose 2.9% in June from a year earlier, BOJ data showed, matching a median market forecast.
It accelerated from the previous month's revised 2.6% gain and rose at the fastest year-on-year pace since August 2023. The index, at 122.7, hit a record high for the seventh straight month.
The yen-based import price index climbed 9.5% in June from a year earlier, accelerating from a revised 7.1% rise in May, in a sign the weakening currency was inflating the price companies charge each other for imported raw material. The pace of increase in the index was the fastest since February 2023.
"Import prices are likely to keep rising due to sustained yen declines and elevated energy prices," said Yutaro Suzuki, an economist at Daiwa Securities.
"Inflation may accelerate toward autumn reflecting the impact of yen falls since the start of this year, which will be critical to the BOJ's decision on when to hike rates," he said.
The BOJ ended eight years of negative interest rates and other remnants of its massive stimulus in March, taking a landmark step toward normalising ultra-loose monetary policy.
BOJ Governor Kazuo Ueda has said the central bank will raise interest rates if it becomes more convinced that Japan was on track to durably hit its 2% inflation target.
He has also said the BOJ will take "monetary policy action" if yen moves have a big impact on inflation, a view echoed by BOJ board member Seiji Adachiin late May.