Japan's corporate services inflation hits two-year high, keeping BOJ on track for rate rises
Japan's services producer price index rose 3.7% in August from a year earlier, the fastest pace in over two years, data from the Bank of Japan showed on Monday.
A key gauge of Japan’s service-sector inflation rose in August at the fastest annual pace in more than two years, data showed on Monday, highlighting mounting price pressures that will keep the central bank on track for further interest rate hikes.
The services producer price index, which tracks the prices that companies charge each other for services, rose 3.7% in August from a year earlier after a 3.6% gain in July, data from the Bank of Japan showed.
The increase in August, the fastest year-on-year pace since June 2024, reflected rising freight, advertising and rental lease fees, in a sign of broadening inflationary pressure, the data showed.
The gauge is closely watched by the BOJ for clues on the extent to which companies are passing on rising labour costs to service-related prices.
The Bank of Japan raised interest rates to a 31-year high of 1.25% this month and its governor signalled the bank’s readiness to push up borrowing costs further to prevent inflation from overshooting its target.
Sources
- Reuters: “Japan’s corporate services inflation hits 2-year high” — https://www.reuters.com/world/asia-pacific/japans-corporate-services-inflation-hits-2-year-high-2026-09-28/
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