TOKYO: Japan's wholesale prices leaped 7.3 per cent in the year to March 2022 as compared to 2021, marking the fastest pace on record, owing to surging prices for crude oil and other commodities, the Bank of Japan (BOJ) said in a report on Tuesday.
The BOJ's latest data showed the pace of increase was the fastest since comparable data became available in 1981 and was punctuated by sharp decline in the Japanese currency underscoring the resource-poor, energy importing country's vulnerability to volatile commodity prices.
In yen terms, the BOJ said the yen's decline caused import costs to leap 32.7 per cent as compared to 2021, while export prices rose 12.3 per cent, Xinhua news agency reported.
Wholesale prices, which refer to the price of goods traded between companies, rose 9.5 per cent in March alone, the central bank said, with the figure, the second-fastest pace on record, coming on the heels of a revised 9.7 per cent rise in February to mark the 13th successive month of increase.
As for the prices of petroleum and coal product, they rocketed 38.3 per cent in the recording period, while nonferrous metals jumped 30.5 per cent, the BOJ said. Scrap prices surged 58.6 per cent, while wood products were up 44 per cent.
Business confidence has slumped of late owing to soaring costs for raw materials, with the outlook clouded by a volatile currency market, the US Federal Reserve's aggressive monetary policy in contrast to the BOJ's continued ultra-accommodative and dovish policy stance, all compounded by uncertainty surrounding the situation in Ukraine.
Market strategists pointed out that with the potential for rising costs to be passed on to consumers, as business earnings are hurt, Japanese Prime Minister Fumio Kishida's response is very much under the spotlight ahead of an upper house election scheduled for this summer.
Among a swathe of products, beverage and food prices gained 3.8 per cent from a year earlier in March, to mark the sharpest gain in over a decade, the BOJ's data showed, with overall import prices in yen terms up 33.4 per cent, compared to a 13.1 per cent increase in export prices.