Japan's Core Inflation Accelerates Amid Energy Cost Pressures

Japan's core consumer inflation is expected to accelerate in July, according to a Reuters poll of economists. The nationwide core consumer price index (CPI), which excludes fresh food prices, was projected to rise 1.8% from a year earlier, exceeding the previous month's rate of 1.6%. This increase is largely attributed to higher energy costs and faster food price gains.

Ryosuke Katagi, a market economist at Mizuho Securities, noted that the data suggests the impact of the worsening situation in Iran on consumer prices is starting to be felt.

The annual wholesale inflation rate remained elevated at 7.2% year-on-year in July, indicating broadening price pressures. The Bank of Japan's (BOJ) decision to raise interest rates to a 31-year high in June has heightened market expectations for further rate hikes.