Japan's core inflation climbs to 3.5%, highest in more than 2 years

Japan's core inflation accelerated to 3.5% in April, government data showed on Friday, bolstered in part by surging rice prices, as the central bank considers pausing its rate hike posture to assess the impact of U.S. tariffs.

The core inflation figure, which strips out prices for fresh food, was higher than expectations of 3.4%, according to economists polled by Reuters, marking the highest level since January 2023.

Headline inflation climbed 3.6% from a year ago, steady from the prior month and staying above the Bank of Japan's 2% target for more than three years.

Bank of Japan Governor Kazuo Ueda has signaled his stance on intending to raise rates given price trends, while also citing the need to monitor closely the effects of U.S. tariffs.

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