TOKYO- Japan’s wholesale inflation held steady at 0.9 percent in April as the yen’s declines pushed up import costs, suggesting another wave of price hikes could prod the central bank to raise interest rates again in the near term.
Analysts expect wholesale inflation to accelerate in coming months, as the effect of government subsidies to curb utility bills fade and add to price pressures from rising import costs.
The year-on-year rise in the corporate goods price index (CGPI), which measures the price companies charge each other for their goods and services, compared with the median market forecast for a 0.8 percent gain and followed a 0.9 percent increase in March.
An index measuring the yen-based import goods prices jumped 6.4 percent in April from a year earlier after a 1.4 percent increase in March, Bank of Japan (BOJ) data showed on Tuesday, reflecting the currency’s recent sharp declines.
“Inflationary pressure driven by rising import costs will likely heighten,” said Toru Suehiro, chief economist at Daiwa Securities. “If such cost-driven price pressure becomes too strong, the BOJ could see scope to raise interest rates.”
