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Japan June wholesale prices jump 5.0% on rising commodities

This photo shows the Bank of Japan headquarters building in Tokyo. (Mainichi)

TOKYO (Kyodo) -- Wholesale prices in Japan surged 5.0 percent in June from a year earlier, due to rising commodity prices amid hopes for an economic recovery from the coronavirus pandemic, Bank of Japan data showed Monday.

    The prices of goods traded between companies marked the fourth monthly increase and followed a revised 5.1 percent rise in May.

    Among major gainers, petroleum and coal products jumped 42.0 percent from a year earlier, and nonferrous metal prices gained 37.6 percent.

    As economic activity picks up in parts of the world where COVID-19 vaccinations have progressed, demand for products such as woods and scrap also rose. Prices of lumber and wood products increased 18.6 percent, while those of scrap soared 74.8 percent, the BOJ data showed.

    "The global economic recovery boosted prices of commodity and a wide range of products," a BOJ official said.

    Japan's economy has benefited from rising demand from its major trading partners such as the United States and China. But the country is still battling with rising coronavirus cases, with Tokyo placed under a fourth COVID-19 state of emergency less than two weeks before the Tokyo Olympics.

    Inflation worries have emerged in the United States and some European nations in recent months. Japan has so far not seen such concerns emerge as the BOJ is still far from achieving its 2 percent inflation target. Wholesale prices affect consumer prices.

    Companies are seen as reluctant to pass surging raw material costs onto consumers at a time when demand remains subdued. But their failure to hike prices could hurt their profits, economists say.

    Import prices gained 28.0 percent from a year earlier while those of exports increased 11.3 percent, both on yen terms.

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