Japan's wholesale goods price index showed its sharpest rise in more than 15 years in January, according to official figures, in a fresh indication the
country may be defeating deflation.
The wholesale goods price index in January rose 2.7% from a year earlier, the sharpest rise since March 1990, according to figures released by the Bank of Japan. Compared with December, the index rose 0.2%, the second monthly increase in a row, the central bank said.
With inflation slowly re-emerging in the world's number two economy after almost eight years of falling prices, markets have been rife with speculation that an end to the central bank's current super-loose policy is close.
The Bank of Japan has signalled that a change to the its quantitative easing policy of flooding the financial system with cash is likely sometime from April but it is under pressure from the government not to act too hastily.
Consumer prices rose in December for the second month in a row and the first back-to-back gain since 1998 - the clearest sign yet that Japan is breaking out of its long deflationary spiral.
The Bank of Japan left its stimulative monetary policy unchanged yesterday to keep financial markets guessing as to when it will scrap its extraordinary anti-deflation measures.