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Japan’s core consumer inflation quickened to 2.8 percent in August to hit the fastest annual pace in nearly eight years, data showed on Tuesday, a sign inflationary pressures from higher raw material costs and a weak yen were broadening.
While core consumer inflation exceeded the central bank’s 2 percent target for five straight months, the Bank of Japan is unlikely to raise interest rates any time soon as wage and consumption growth remain weak, analysts say.
The data highlights the dilemma the BOJ faces as it tries to underpin a fragile economy by maintaining ultra-low interest rates, which in turn is fueling an unwelcome slide in the yen that is driving up households’ cost of living.
