Prices in Tokyo jumped the most in two years on surging food costs, keeping the Bank of Japan (BOJ) on track for another rate hike in the coming months.
Consumer prices excluding fresh food rose 3.6% in the capital in May from a year earlier, accelerating from 3.4% in April, the internal affairs ministry said Friday. The increase, which outpaced economists’ median forecast of a 3.5% gain, was the biggest since January 2023. Overall inflation came to 3.4%, matching a revised 3.4% in April.
The readings were partly distorted by policy-related factors, including the fading impact of last year’s school fee cuts. While Tokyo’s consumer price index (CPI) figures serve as a leading indicator for national inflation trends, the high school subsidies were in effect only in the capital.
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