Japan Producer Inflation Highest in 10 Months

Japan’s producer prices rose 6.3% yoy in May 2026, accelerating from an upwardly revised 5.3% increase in the prior month and topping market expectations of 5.5%. It was the fastest annual growth since March 2023, reflecting persistent cost pressures, particularly from higher energy prices amid supply chain disruptions stemming from the conflict involving Iran. Main upward pressure came from rising prices of transport equipment (2.0% vs 1.8% in April), drinks and foods (4.1% vs 4.1%), chemicals (13.4% vs 10.1%), petroleum & coal (13.8% vs 5.3%), electrical machinery (3.2% vs 4.1%), production machinery (3.4% vs 3.8%), metal products (1.6% vs 1.1%), electronic components (2.8% vs 3.0%), and information and communications (13.1% vs 12.4%), and textile (1.2% vs 0.7%). Meanwhile, the cost of iron & steel fell more slowly (-1.2% vs -1.9%). Monthly, producer prices increased 0.9%, easing from an upwardly revised 2.8% rise in April, which had been the strongest monthly gain since April 2014.

Japan’s producer prices rose 4.9% yoy in April 2026, accelerating from an upwardly revised 2.9% increase in the prior month and exceeding market estimates of 3%. This was the fastest annual growth since May 2023, amid intense cost pressures following a spike in energy costs linked to supply chain disruptions from the war in Iran. Main upward pressure came from transport equipment (1.6% vs 1.4% in March), drinks and foods (4.1% vs 4.3%), chemicals (9.2% vs 0.8%), petroleum & coal (5.3% vs -7.1%), electrical machinery (3.8% vs 2.9%), production machinery (3.8% vs 4.2%), metal products (1.0% vs 0.6%), electronic components (2.9% vs 2.6%), and information and communications (5.8% vs 6.5%). At the same time, textile prices rebounded (0.7% vs -0.5%), while the cost of iron & steel fell more slowly (-1.9% vs 4.9%). On a monthly basis, producer prices increased 2.3%, picking up from a 1.0% gain in March and marking the strongest monthly rise since April 2014.

Japan’s producer prices rose 2.6% yoy in March 2026, quickening from a marginally revised 2.1% increase in the prior month and topping market estimates of 2.4%. This was the fastest annual growth since November, amid elevated cost pressures. Price growth accelerated for transport equipment (1.3% vs 1.2% in February), production machinery (4.1% vs 2.7%), and information and communications (3.0% vs 2.5%). At the same time, prices fell at a milder pace for chemicals (-0.4% vs -2.5%), iron & steel (-5.0% vs -5.5%), and petroleum & coal (-7.3% vs -11.7%). In contrast, inflation slowed for drinks and foods (4.3% vs 4.8%), other manufacturing (2.3% vs 2.5%), metal products (0.6% vs 1.1%), general-purpose machinery (2.4% vs 2.8%), non-ferrous metals (31.1% vs 32.6%), electrical machinery (2.6% vs 2.7%), and business-oriented machinery (2.6% vs 2.7%). Monthly, producer prices increased 0.8%, picking up from a 0.1% gain in February, marking the strongest monthly rise since November 2022.