Japan wholesale prices rise 7.2 percent in August
Japan's wholesale inflation remained near a 27-year high in August, the government said Wednesday, as the soaring costs of energy and raw materials continued to pressure businesses.
The index for domestic corporate goods prices rose 7.2 percent from a year ago, the Bank of Japan said.
The result was largely in line with market forecasts and fell just below a revised 7.3 percent increase in July, which marked the steepest climb since an 8.1 percent gain in January 1981. Then, as now, high oil prices drove inflation.
Despite higher costs, companies have yet to fully pass those increases on to customers. The data suggest that consumer inflation may be headed up over the next few months, threatening to further sap demand in an already slowing economy.
The core consumer price index, excluding fresh food prices, increased 2.4 percent in July.
With oil dropping toward $100 a barrel, wholesale prices are beginning to soften, said Seiji Shiraishi, chief economist at HSBC Securities in Tokyo.
"They're high, but it looks like this is the peak," he said.
The consumer price index, meanwhile, probably won't peak until later this year, Shiraishi added.
Behind the corporate goods index were surging prices of petroleum and coal products, which rose 43.3 percent after a revised 44.3 percent increase in July, according to the data. Iron and steel product prices jumped 28.6 percent after climbing a revised 27.0 percent in July.
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