Japan’s consumer prices rose at a faster pace than expected in May while the deeper inflation trend continued to strengthen, outcomes that could fuel speculation the central bank will raise its inflation forecasts in July and even tweak its stimulus program.
Prices excluding those for fresh food gained 3.2% from a year ago, decelerating from a 3.4% rise in April, the internal affairs ministry reported Friday. While the national data was consistent with the results of earlier figures for Tokyo showing the impact of a reduced levy on electricity prices, the reading still outpaced analysts’ forecasts of a 3.1% increase.
A measure of inflation that also excludes energy continued to strengthen to hit 4.3%, showing the underlying price trend is continuing to gain momentum. The reading was the highest since 1981.