MNI BRIEF: Japan Sept Services PPI Rises 3.0% Vs. Aug +2.7%

Japan’s services producer price index rose 3.0% y/y in September, up from August’s unrevised 2.7%, indicating continued corporate pass-through of higher costs, preliminary Bank of Japan data showed Monday.

The increase was driven by other services, including hotels (11.1% vs 7.6%) and transportation and postal activities (3.6% vs 3.3%). On a monthly basis, the SPPI gained 0.1% after a 0.2% rise in August.

Services with a high labour cost ratio rose 3.3% y/y, unchanged from August, while those with a low labour cost ratio increased 2.4% from 2.1%.

BOJ officials judged that while services prices continue to rise as firms pass through higher labour and distribution costs, the pace lacks momentum and remains insufficient to secure the 2% inflation target in a stable, sustainable manner.