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Japan's wholesale prices drop 2.1% in Oct. due to falling oil costs

This March 16, 2020 photo shows the head office of the Bank of Japan in Tokyo. (Kyodo)

TOKYO (Kyodo) -- Japan's wholesale prices dropped 2.1 percent in October from a year earlier due largely to falling crude oil costs and lower electricity bills, the Bank of Japan said Thursday.

    The prices of goods traded between companies fell for the eighth straight month, marking the largest decline since a revised 2.8 percent decrease in May, despite the central bank's efforts to achieve a 2 percent inflation target.

    Prices for oil and coal products tumbled 16.2 percent from the previous year, as crude oil prices fell in the reporting month due to the slow pace of recovery of the global economy amid the novel coronavirus pandemic.

    Electricity, gas and water bills sank 7.6 percent, reflecting lower crude oil prices since spring.

    "Weak demand in the global economy including falling crude oil prices caused by the continued impact of the pandemic significantly affected prices in Japan," a BOJ official said.

    Due to weak domestic demand amid the prolonged impact of the pandemic, iron and steel product prices dropped 2.8 percent while those for lumber and wood products dipped 2.2 percent.

    Import prices fell 10.6 percent and export prices declined 1.7 percent, both in yen terms.

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