BOJ Wary of Inflation Pressure amid Middle East Tensions

Tokyo, April 10 (Jiji Press)--The Bank of Japan is increasingly cautious about inflationary pressure stemming from rising crude oil prices amid Middle East tensions.

BOJ data showed Friday that the producer price index, which measures the costs of goods traded between companies, rose 2.6 pct year on year to 129.5 in March, against the 2020 average of 100.

A rise in producer prices would lead to increases in companies' procurement costs, and eventually to growth in consumer prices. The BOJ is expected to face difficulties steering its monetary policy as raising interest rates to contain inflation could cool the economy.

The March producer price index rose also from the previous month, by 0.8 pct, with the pace of growth accelerating from the 0.1 pct in February.

Prices of petroleum and coal products, such as gasoline and gas oil, rose 7.7 pct month on month, while chemical products, including benzene, a material for plastics and synthetic rubber, climbed 1.7 pct.

[Copyright The Jiji Press, Ltd.]