Japan Wholesale Inflation Hits Three Year High in May
Japan's producer price index rose 6.3% in May, exceeding market expectations and marking the fastest acceleration since March 2023. The surge in energy and import costs has increased pressure on the Bank of Japan to raise interest rates at its upcoming policy meeting on June 16.
The Bank of Japan faced accelerating wholesale inflation of 6.3% in May, the fastest pace in three years as energy costs spiked. This reading exceeded market forecasts for a 5.5% increase and followed a revised 5.3% gain in April. The surge in producer prices increases the likelihood that Bank of Japan will raise interest rates during its upcoming policy meeting.
Higher costs for nonferrous metal, chemical, and petroleum goods drove the increase. Bank of Japan data showed the effective closure of the Strait of Hormuz pushed up crude oil and naphtha prices.
