Japan June Wholesale Prices: Ideas Later.

Japan wholesale prices up 7.1% in June, fastest rise in over 3 years

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TOKYO (Kyodo) -- Japan's wholesale prices rose in June at the fastest pace in over three years, gaining 7.1 percent from a year earlier, as increased prices for oil and its derivatives due to the Middle East conflict spread to a wide range of industries, the Bank of Japan said Friday.

Prices of goods traded between companies rose from a revised 6.6 percent in May, in a further sign of heightening inflationary pressures in Japan, which is heavily reliant on oil imports from the Middle East and is scrambling to secure alternative sources with higher shipping costs.

The margin of increase was the largest since March 2023.

The outcome showed that price rises, initially seen among products directly related to crude oil, are starting to spread to consumer goods, a BOJ official said.

Prices for naphtha, a raw ingredient of chemicals used in the manufacture of plastics and packaging materials, surged 81.6 percent, while petroleum and coal products, including gasoline and heavy oil, climbed 22.8 percent.

Chemicals and related products, including synthetic rubber, rose 14.4 percent, and lumber and wood products 8.0 percent on increased import costs due to a weaker yen.

Wholesale price movements affect consumer prices, a key factor in the BOJ's monetary policy decisions as it seeks to sustainably achieve 2 percent inflation. The central bank raised its policy rate in June to a 31-year high of 1.0 percent.

Electric power, gas and water also rose 3.4 percent, reflecting higher prices for liquefied natural gas, while personal computers and digital cameras drove information and communications equipment prices up 14.5 percent.

Import prices surged 29.7 percent from a year earlier, the largest margin since a gain of 42.3 percent in October 2022, amid the weak yen and the spread of artificial intelligence technology, which has increased prices for memory used in computers. Export prices jumped 20.7 percent.

Article source:  https://mainichi.jp/english/articles/20260710/p2g/00m/0bu/022000c