TOKYO : Japan's core consumer inflation likely hovered at a near two-year high in December as surging fuel and raw material costs continued to push up living costs for households, a Reuters poll showed on Friday.
But Japan's inflation remains far modest than that of other major economies including the United States, where strong demand and a tight job market are pushing up prices enough for the central bank to eye several interest rate hikes this year.
The nationwide core consumer price index (CPI) likely rose 0.6per cent in December from a year earlier, according to the median forecast in the poll of 18 economists.
That would mark the fastest pace of increases since February 2020 and higher than a 0.5per cent increase in November.
"Prices in Japan have been weak, but we're seeing the ripple effect of higher import costs due to a weak yen and soaring raw material costs," said Takeshi Minami, chief economist at Norinchukin Research Institute.
The poll also showed Japan's exports likely gained 16.0per cent year-on-year in December to mark the 10th straight month of expansion, following a 20.5per cent rise in the previous month.
Imports are expected to have surged 42.8per cent in value in December due to rising energy and raw material costs, according to the poll.
Core machinery orders likely grew 1.4per cent in November from the prior month, posting a second month of increase in a positive sign for capital expenditure, the poll showed.
The government will release CPI data at 8:30 a.m. on Jan. 21 (2330GMT, Jan. 20), trade data at 8:50 a.m. on Jan. 20 (2350GMT, Jan. 19) and machinery orders data at 8:50 a.m. on Jan. 17 (2350GMT, Jan. 16).
(Reporting by Kantaro Komiya; Editing by Kim Coghill)