In May, rice prices in Japan rose by more than 100% year-on-year.

Jin10 data June 20: As Japanese Prime Minister Shigeru Ishiba prepares for the summer elections and the Central Bank analyzes price trends, the country’s key inflation indicator has accelerated to a two-year high. The Japanese Ministry of Internal Affairs and Communications reported on Friday that the core consumer price index, excluding fresh food, rose 3.7% year-on-year in May, marking the third consecutive month of acceleration and the largest increase since January 2023, surpassing the market expectation of 3.6%. Food prices remain the main driver, with the price of staple rice soaring 101.7% year-on-year and rising 3.4% month-on-month. As this report is released, Ishiba’s minority government and the opposition parties are engaged in a game of negotiations on how to alleviate cost of living pressures. Meanwhile, persistently high inflation provides support for the Japanese Central Bank to raise interest rates as it assesses the economic impact of U.S. tariff policies.