Tokyo Aug core consumer prices rise at fastest pace in nearly 8 years

Core consumer prices in Japan’s capital Tokyo rose in August at their fastest pace in nearly eight years, as inflationary pressures broadened due to higher fuel and raw material costs.

The core consumer price index for Tokyo gained 2.6% in August, above the median market forecast for a 2.5% rise. The pace of increase, which followed a 2.3% gain in the previous month, was the fastest since October 2014.

The data heightens the chance nationwide consumer prices will continue to rise in coming months, though the pace of gains has remained modest compared with other major economies.

The world’s third-largest economy saw nationwide core CPI rise 2.4% in July from a year earlier, driven by fuel and raw material prices and straining households yet to see significant wage gains.

While inflation has now exceeded the Bank of Japan’s 2% target for four straight months, the central bank is still expected to keep monetary conditions ultra loose for the time being.