\n<\/p>\n
Customers look at vegetables and other groceries at a supermarket in Tokyo on June 20, 2025.<\/p>\n
Kazuhiro Nogi | AFP | getty images<\/p>\n<\/div>\n<\/div>\n<\/div>\n
Core inflation in Japan rose for the first time in five months, rising to 1.8% in March as higher energy prices due to the war with Iran boosted consumer inflation. <\/p>\n
Government data showed the inflation figure – which strips out fresh food prices – was in line with the 1.8% expected by economists surveyed by Reuters, and higher than the 1.6% seen in February. <\/p>\n
Headline inflation came in at 1.5% compared with 1.3% in February, staying below the central bank’s 2% target for the second consecutive month. <\/p>\n
The so-called “core-core” inflation rate, which strips out both food and energy prices, fell to 2.4% from 2.5% in February, its lowest level since October 2024. <\/p>\n
Rice inflation, which had made headlines for exceeding 100% in mid-2025, rose 6.8%, its slowest pace since January 2024. <\/p>\n
A Bank of Japan survey<\/a> Data released on Monday showed that more than 83% of respondents expect prices to be higher after a year.<\/p>\n Bank of America analyst Takayasu Kudo said in a note earlier this week that the impact of higher energy prices is likely to be more pronounced in the early summer, pushing up both actual inflation and inflation expectations. <\/p>\n \u201cThese developments should strengthen the case for the BOJ to maintain its gradual rate-hike trajectory\u2026 We still see a strong likelihood that the BOJ will maintain a bias towards further rate hikes over the medium term.\u201d<\/p>\n According to Citi analysts, the inflation data comes ahead of the BOJ’s meeting on April 27 and 28, where the central bank is expected to keep rates at 0.75%. <\/p>\n Citi said the pause was “likely to be tough” and was due to concerns about further yen depreciation and the risk of falling behind the curve on inflation. <\/p>\n