Japan's Corporate Services Prices Rise Most Since June 2024

The Bank of Japan reported that Japan's Corporate Services Price Index (2020 average = 100) rose to 115.4 in August, a 3.7% increase from last year.

This growth rate was the largest since June 2024 and marks the 66th consecutive month of increases. The index also saw a 0.3% gain on a month-over-month basis.

The main drivers behind this growth were rising transportation costs, particularly in ocean freight transportation, which surged to a record high of 271.8 with a 74.2% increase from last year. This is largely due to the deteriorating Middle East situation and increased shipping costs.

The data also showed that 121 out of 146 items surveyed experienced price gains, indicating widespread pass-through in the services sector. Labor-intensive services, such as civil engineering and architectural services, rose 3.7% due to labor cost pass-through and worker shortages at construction sites.