Japan Wholesale Inflation Surges, Boosting Rate-Hike Bets

Japan's wholesale inflation continued its upward trend in July, reaching an annual increase of 7.2% from a year earlier, according to data released by the Bank of Japan (BOJ). This marks a slight decrease from June's revised 7.3% gain and is slightly lower than market forecasts for a 7.4% increase.

The producer price index also rose 0.1% on a month-on-month basis in July, following June's revised 0.5% increase. The yen-based import price index increased by 29.1% from a year earlier, after a revised 30.1% surge in June.

This data comes amid growing hawkish communication from the BOJ, with some policymakers calling for speeding up the pace of rate hikes to combat inflation risks. In July, the BOJ kept policy steady but warned that underlying inflation could exceed its target and said future discussions would focus on upside price risks.