By Leika Kihara
TOKYO (Multibagger) - Japan's wholesale inflation accelerated in June as the yen's declines pushed up the cost of raw material imports, data showed on Wednesday, keeping alive market expectations for a near-term interest rate hike by the central bank.
The corporate goods price index (CGPI), which measures the price companies charge each other for their goods and services, rose 2.9% in June from a year earlier, Bank of Japan data showed, matching a median market forecast and accelerating from the previous month's revised 2.6% gain.
The yen-based import price index increased 9.5% in June from a year earlier, accelerating from a revised 7.1% rise in May, in a sign the weakening currency was inflating the price companies charge each other for imported raw material.
Analysis:
Japan's wholesale inflation accelerated in June due to the yen's declines, leading to higher import costs for raw materials. This has fueled expectations for a near-term interest rate hike by the central bank. The corporate goods price index rose 2.9% from a year earlier, matching market forecasts and indicating a faster pace of inflation. The yen-based import price index also increased significantly, showing the impact of the weakening currency on raw material prices. This trend could have implications for the broader economy and financial markets, potentially affecting interest rates and investment decisions. It's important for investors to monitor these developments closely to make informed financial choices.