Services prices, a key component of Japan’s inflation figures, are holding steady, which only strengthens the case for the Bank of Japan to take another step toward policy normalization in the foreseeable future.
Rising prices for everything from haircuts to dry cleaning show that underlying consumer price trends may be stronger than in the past. About 60% of major service providers surveyed in March said they would raise prices or are considering doing so in April, the Nikkei newspaper said.
“Prices of some service items that have seen little change in the past have recently risen by about 1%, confirming the positive development cited by the BOJ,” said Hiroshi Kawata, senior economist at Mizuho Research & Technologies.
