Japan Inflation Hits Two-Year High as Yen Weakness Bites

Inflation in Japan accelerated to 1.8 percent last month, exceeding expectations and reinforcing predictions of further monetary tightening by the Bank of Japan.

The core inflation rate excluding food rose from 1.6 percent, according to data released by the internal affairs ministry on Friday.

A weak yen has contributed to higher prices for oil and food imports in resource-poor Japan, while helping big exporters like Toyota and Sony.

Prime Minister Sanae Takaichi's government has implemented fuel and energy subsidies to shield consumers from rising oil prices, but this move has cost the country 10 trillion yen ($63 billion) in lost tax revenues over two years.