Japan's service-sector price index climbs to two-year peak in August
Japan's services producer price index jumped 3.7% year-on-year in August, the fastest rise since June 2024, signaling broader inflation pressures.
Data released by the Bank of Japan showed that the services producer price index rose 3.7% in August over the same month last year, marking the quickest year-on-year growth since June 2024. The increase followed a 3.6% rise in July and reflects expanding price pressures across freight, advertising and rental lease fees. Officials use this gauge to gauge how much companies are shifting higher labour costs onto service charges.
The upward trend adds to concerns about persistent inflation, keeping the central bank on a path toward further monetary tightening. Earlier this month, the Bank of Japan raised its benchmark interest rate to 1.25%, the highest level in 31 years, and the governor indicated readiness for additional hikes if needed.
Why it matters
Rising service-sector inflation could prompt more rate hikes, affecting borrowing costs and the broader Japanese economy.
How this story developed
- Sep 7 U.S. interest costs hit $1.25 trillion, consuming nearly one-fifth of federal revenue
- Sep 11 US Treasury prices slipped Friday, lifting the 10-year yield to roughly 4.97%, close to the 5% mark, as oil prices climbed and expectations of a Federal Reserve rate hike grew.
- Sep 16 The Federal Reserve announced a quarter-point increase in its benchmark rate, marking the first hike since the previous administration and the first under Chair Kevin Warsh.
- Sep 16 The Fed announced a quarter‑point increase to its key interest rate.
- Sep 17 Fed increased the federal funds rate by 25 basis points to a 3.75‑4 percent target range in its first hike since 2023, with a 12‑0 vote.
- Sep 17 The Federal Reserve lifted its policy rate by a quarter point, its first increase in three years.
- Sep 18 Fed officials indicated that at least one more 0.25‑point rate increase may be implemented before year‑end.
- Sep 22 AMD’s market value reached $1 trillion.
- Sep 25 Treasury yields have risen, pushing interest costs to consume nearly one‑fifth of revenue.
- Sep 25 Bond yields climbed back above 5% and oil prices rebounded, pushing Wall Street lower.
- Sep 25 US stock futures rose on Friday as Treasury yields slipped and Brent crude fell to $98.83 a barrel.
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