TOKYO :A leading indicator of Japan’s service-sector inflation perked up in August, data showed on Thursday, backing up the central bank’s view that rising labour costs will help keep inflation sustainably around its 2 per cent target.
The services producer price index, which tracks the price companies charge each other for services, rose 2.7 per cent in August from a year earlier, Bank of Japan data showed, accelerating from a revised 2.6 per cent gain in July.
Hotel prices rose 7.6 per cent year-on-year in August, accelerating from a 5.4 per cent gain in July, reflecting solid demand from inbound tourism, the data showed.
The BOJ ended a decade-long, massive stimulus programme last year and in January raised short-term interest rates to 0.5 per cent on the view Japan was on the cusp of durably meeting its 2 per cent inflation target.
With consumer inflation exceeding 2 per cent for well over three years, the central bank has signaled its readiness to keep hiking borrowing costs further if the economy sustains a moderate recovery.
