Business / Economy

June wholesale prices in Japan fall 1.6% on weak demand due to virus

Kyodo

Wholesale prices fell 1.6 percent in June from a year earlier due to weak demand for a wide range of products amid the novel coronavirus pandemic, the Bank of Japan said Friday.

The price of goods traded between companies dropped for the fourth straight month, but the decline slowed from a revised 2.8 percent fall in May, due largely to firmer crude oil prices.

Prices for oil and coal products fell 25.9 percent, against a revised 36.5 percent tumble the previous month, reflecting a pick-up in demand in major economies and as coordinated production cuts by oil-producing countries tightened supply, thus lifting prices, a BOJ official said.

“Rising crude oil prices somewhat supported the overall wholesale prices, but the virus spread continues to put pressure on domestic demand for a wide range of products including agricultural items,” the BOJ official said.

Prices for chemical products sank 5.9 percent while prices for nonferrous metal products fell 1.3 percent due to weak demand caused by the spread of COVID-19, the disease caused by the virus.

Scrap and waste prices dropped 11.4 percent, but the decline slowed from a 25.7 percent fall in May, reflecting growing demand in China as economic activities there start to recover, the BOJ official said.

Excluding the impact of the consumption tax hike to 10 percent from 8 percent on Oct. 1, wholesale prices shed 3.1 percent, but picked up from a revised 4.2 percent fall the previous month.

Import prices fell 15.6 percent while export prices decreased 4.1 percent from the previous year, both in yen terms.

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