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April wholesale prices up 5.8% yr/yr - data
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Wholesale inflation moderates for 4th straight month
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Data heightens chance of slowdown in consumer inflation
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BOJ Ueda has vowed to keep easy policy until wage hikes
broaden
(Adds analyst quote, details)
By Leika Kihara
TOKYO, May 15 (Reuters) - Japan's wholesale inflation
slowed for a fourth straight month in April as rises in raw
material costs moderated, data showed on Monday, suggesting that
consumer inflation will begin to ease back towards the central
bank's 2% target.
The data may diminish market expectations that broadening
inflationary pressure will prod the Bank of Japan to seek an
early exit from ultra-low interest rates.
The corporate goods price index (CGPI), which measures the
price companies charge each other for their goods and services,
rose 5.8% in April from a year earlier, slowing its annual pace
of increase for the fourth straight month, BOJ data showed.
The increase exceeded a median market forecast for a 5.4%
gain and followed a 7.4% rise in March.
"Many firms have yet to fully pass on past rises in input
costs. We also might see companies hike prices to translate
higher labour costs given big wage hikes they've agreed to in
this year's wage negotiations with unions," said Takeshi Minami,
chief economist at Norinchukin Research Institute.
"Having said that, we'll likely see price growth slow as
import-driven inflationary pressure is already subsiding."
The yen-denominated import price index fell 2.9% in April
from a year earlier after a revised 9.6% gain in March, the data
showed, a sign the cost of importing fuel and raw material was
peaking.
Analysts are closely watching moves in wholesale prices,
considered a leading indicator of consumer price trends, for
clues on whether consumer inflation will heighten enough for the
BOJ to phase out its massive stimulus.
Japan's core consumer inflation hit 3.1% in March and an
index excluding fuel costs rose at the fastest annual pace in
four decades in a sign of broadening price pressure.
BOJ Governor Kazuo Ueda has said the central bank will keep
monetary policy ultra-loose unless the recent rise in consumer
inflation is driven more by robust domestic demand, and
accompanied by higher wage growth.
(Reporting by Leika Kihara; Editing by Kim Coghill and
Jacqueline Wong)
