Japan core inflation accelerates after five months as Iran war stokes energy worries

Core inflation in Japan accelerated for the first time in five months, rising to 1.8% in March as Iran war-fueled higher energy prices stoke consumer inflation. Government data showed the inflation figure — which strips out prices of fresh food — was in line with the 1.8% expected by economists polled by Reuters, and was higher than the 1.6% seen in February Headline inflation came in at 1.5%, compared with 1.3% in February, staying below the central bank's 2% target for a second straight month. The so-called "core-core" inflation rate, which strips out prices of both food and energy, dipped to 2.4% from February's 2.5%, marking its lowest level since October 2024. Japanese Prime Minister Sanae Takaichi has been considering steps ‌to cushion the economic blow from rising fuel costs, including curbing gasoline prices. Tokyo has also released crude from its stockpiles to mitigate an oil shock. According to Japanese media reports fuel subsidies have been rolled out since March, with Takaichi saying that she plans to cap pump prices at an average of 170 yen ($1.07) per liter nationwide, warning that gasoline could potentially hit 200 yen per liter. If gasoline prices were at roughly 200 yen and capped at 170 yen, the subsidy could cost around 300 billion yen per month, according to Finance Minister Satsuki Katayama. A Bank of Japan survey released Monday showed that more than 83% of the respondents expect prices to be higher after one year. Bank of America analyst Takayas