The gain probably won't be enough to persuade the Bank of Japan to raise interest rates as the U.S. economic slowdown and financial-market turmoil cloud the outlook for growth. Falling prices in Japan have hindered the central bank's plans to lift rates from 0.5 percent, the lowest among major economies.
The most Japan's consumer price index has risen in the past nine years is 0.3 percent in August 2006. The Bank of Japan raised the key overnight lending rate in July 2006 after holding it near zero for more than five years to overcome deflation. Policy makers doubled the rate to 0.5 percent in February.