Japan core inflation hits two-year high

Japanese inflation spiked at a two-year high in April, government data showed yesterday, as rice prices almost doubled, turning focus on the central bank as it mulls more interest rate hikes amid US President Donald Trump's trade war.

- NATSUKO FUKUE

The news also puts pressure on Prime Minister Shigeru Ishiba ahead of elections in July and after a minister was forced to resign over a gaffe about the national food staple while officials were forced to dip into emergency stockpiles.

Core inflation excluding fresh food hit 3.5% last month, the internal affairs ministry said, its highest since January 2023 and well up from the 3.2% in March.

Rice prices soared an eye-watering 98.4% year-on-year, slightly more than the previous month's increase.

The rocketing cost of a key part of Japanese people's diet is growing into a crisis for the government, which was already struggling to win popularity having lost its parliamentary majority in an election last year.

Factors behind the shortfall include poor harvests due to hot weather in 2023 and panic-buying prompted by a “megaquake” warning last year.