Japan's Inflation Hits 1.9% Amid Rising Energy Costs

Japan's inflation rose to 1.9% in July, reaching its highest level so far this year, according to recent data.

The increase was largely driven by higher energy costs amid tensions in the Middle East, which led to a significant rise in oil prices.

Despite government subsidies implemented by Prime Minister Sanae Takaichi, energy prices increased for the first time since November 2025.

Fresh food prices also accelerated, rising by 7% compared to June's 3.9% increase.

The Bank of Japan expects further pressure on inflation in the coming months, forecasting that core inflation will remain above 2% in the second half of fiscal 2026.