By Leika Kihara
TOKYO (Reuters) -Japan’s annual wholesale inflation slowed for the fourth straight month in July, data showed on Wednesday, underscoring the central bank’s view that upward price pressure from raw material costs will dissipate.
But the wholesale prices of food and agriculture goods continued to rise in a sign of broadening price pressure that will likely keep alive market expectations of an interest rate hike by the Bank of Japan (BOJ).
The corporate goods price index (CGPI), which measures the price companies charge each other for their goods and services, rose 2.6% in July from a year earlier, data showed, slowing from the previous month’s 2.9% increase. It compared with a median market forecast for a 2.5% rise.
The yen-based import price index fell 10.4% in July from a year earlier, following a revised 12.2% drop in June, the Bank of Japan (BOJ) data showed.
While prices of chemical and steel goods fell, those of food and beverages rose 4.2% in the year to July, the data showed.
The BOJ ended a decade-long, massive stimulus last year and raised interest rates to 0.5% in January on the view Japan was on the cusp of durably achieving its 2% inflation target.
While core consumer inflation has exceeded the BOJ’s target for well over three years, governor Kazuo Ueda has stressed the need to tread cautiously in raising rates further on the view price rises were driven mostly by one-off factors like higher raw material costs.
(Reporting by Leika Kihara; Editing by Tom Hogue and Shri Navaratnam)
