Japan's Inflation Accelerates to 1.9%, BOJ Warns of Further Gains

Japan's inflation rate accelerated to 1.9% in July, the highest level this year, driven by rising energy costs and a weak yen.

The country's core inflation rate, which excludes fresh food but includes energy, rose 1.8% from a year earlier, meeting economists' expectations.

Wholesale inflation, however, surged 7.2% in July, with electricity charges making the largest contribution, indicating significant pressure on businesses.

The Bank of Japan warned that inflation could accelerate further, citing factors such as wage increases being passed through to selling prices and the yen's depreciation.

Japanese authorities have intervened in foreign-exchange markets to support the yen, but the currency remains weak due to its low interest rates compared to other major economies.