AI Data Insight
Japan's Corporate Goods Price Index (PPI) for Q1 2026 (February) rose to 129.5, up 0.9% month-on-month and 2.6% year-on-year from the previous value of 128.3, defying the market consensus of a slowdown. Wage growth and rising labor costs drove up service and construction quotes, offsetting the weakness in some raw material prices. Looking ahead, the effect of the "Shunto" (spring wage offensive) pay hikes and fluctuations in the Japanese yen exchange rate will determine the Bank of Japan's subsequent pace of interest rate hikes and the trajectory of inflation.