Wholesale prices rose at their fastest pace in more than two years in February on higher oil prices, up 1 percent from a year earlier, Bank of Japan data showed Monday.
The result bodes well for the central bank, which has been trying to achieve a 2 percent inflation goal by implementing aggressive monetary easing measures. Wholesale prices, which fell for a second year in 2016, tend to affect consumer prices.
In February, prices of oil and coal products rose 27.1 percent and nonferrous metals climbed 8.2 percent. But prices of electrical machinery fell 2.7 percent and those of plastic products dropped 2.4 percent, suggesting recent price hikes have been caused by higher energy costs rather than growth in domestic demand.
Import prices increased 10.1 percent, while export prices were up 2.5 percent, both in yen terms. The depreciation of the yen boosts import costs.
The 1 percent rise in wholesale prices in February was the sharpest since the 1.1 percent climb in August 2014 that excluded the impact of the consumption tax hike in April that year. In January, wholesale prices rose for the first time in 22 months.
Japan's core consumer prices, meanwhile, rose 0.1 percent from a year earlier in January, marking the first growth in 13 months.