Japan's Core Inflation Rate Remains Below Target for Third Consecutive Month

On May 1, Jin10 reported that Tokyo's core inflation rate stood at 1.5% in April, marking the third consecutive month it remained below the Bank of Japan's target level. This follows a 1.7% increase in March. According to Jin10, the lower inflation rate was attributed to fuel subsidies offsetting the rising raw material costs due to Middle Eastern conflicts. Analysts anticipate that the Consumer Price Index (CPI) will accelerate in the coming months as oil prices surge and the yen weakens, leading to higher import costs. This situation is putting pressure on the Bank of Japan to consider raising interest rates. Earlier this week, the Bank of Japan maintained its benchmark interest rate at 0.75% but acknowledged the need to prevent further increases in potential inflation rates. The bank also pledged to seek further rate hikes once geopolitical risks subside.