Japan October Wholesale Inflation Accelerates to 7.1%, Cementing December BOJ Rate Hike Bets

Japan's wholesale inflation climbed 7.1% year-on-year in October, beating expectations of 6.5% and accelerating from 6.8% in September. On a monthly basis, producer prices rebounded 0.7%, driven by rising costs across petroleum, chemicals, utilities, and industrial metals. Yen-denominated import prices jumped 24.8% annually, sustained by elevated commodity prices and ongoing currency depreciation. The mounting pipeline pressures have reinforced market expectations that the Bank of Japan will raise its policy rate by 25 basis points to 1.50% at its December 17–18 meeting, marking its third rate increase in 2026.