Japan: June nationwide CPI indicates inflation is turning up

Research evidence excerpt

Japan: June nationwide CPI indicates inflation is turning up

J P M O R G A N Japan Economic Research

24 July 2026

Japan: June nationwide CPI

indicates inflation is turning up

Economic and Policy Research

Ayako Fujita

(81-3) 6736-1172

ayako.fujita@jpmorgan.com

JPMorgan Securities Japan Co., Ltd.

The June nationwide CPI indicated that rising prices for petroleum-related

products are gradually beginning to be passed through to consumers. Core (ex.

fresh food) CPI rose 0.2%m/m sa, bringing the oya rate to 1.6%, marking a reversal

of the downward trend that has persisted since late-2025. Government subsidies,

which have accelerated since late-2025, continue to suppress inflation in energy

and public services. Many companies, while facing higher costs due to the ongoing

depreciation of the yen and rising wages, have refrained from raising prices since

2H25 amid consumer fatigue with price increases. However, the global energy

price shock appears to have provided a catalyst for a broad range of firms to raise

prices. Although domestic energy prices are being held down by subsidies, many

price hikes—particularly for food and core goods—are scheduled going forward.

The June CPI appears to offer the first signs of these developments.

Looking at the details, prices have risen for items such as home repairs (3.6%oya)

and household consumables (3.6%), reflecting higher petroleum product prices.

However, this price shock is only one aspect of the inflation picture: a firm trend

also persists across a broad range of private service prices, including auto insurance

premiums (5.3%), telecommunications (4.6%), and accommodation (3.1%). In

addition, reflecting the recent strength in durable goods consumption, household

durable goods inflation rose 1.0%m/m sa to 3.0%oya.