Japan's Core Inflation Accelerates, But Remains Below BOJ Target

Japan's core inflation accelerated in June to 1.6%, exceeding market expectations but still below the Bank of Japan's (BOJ) 2% target for a fifth consecutive month.

The rise was partly due to last year's sharp fall in gasoline prices, which had a base effect on this year's numbers.

However, food inflation moderated due to slumping rice prices, while service inflation slowed to 1.2% from 1.4% in May.

The core consumer price index (CPI) is a closely watched metric by the BOJ, and its acceleration may lead to further interest rate hikes as the central bank aims to control rising input costs.