Japan's service costs jump as Bank of Japan weighs next money move
Latest data shows Japanese service-sector costs climbing to 2.9% while companies keep raising prices. Bank of Japan looks at these numbers before its mid-december meeting where rate changes might happen
Japans service-sector costs went up to 2.9% this october (compared to last year) showing how businesses keep pushing their prices up
The numbers from Bank of Japan point to wide-spread price changes in fix-it shops‚ hotels and building work. Its clear that higher worker pay is making companies charge more for what they do — which fits with what Kazuo Ueda and his team thought would happen
Weʼre seeing progress on the domestic front ‚ pointing to signs that wage hikes will continue
Companies in Japan usually change their service costs twice yearly:
- When fiscal year starts in april
- During fall season in october
The central bank watches these price moves real close; they might help decide if its time to change interest rates at their dec 18-19 meeting. Right now the rate sits at 0.25% (after they moved it up from zero back in summer)
More than half the money-experts think Ueda will push rates higher next month — the bank already did this twice this year. Consumer costs for services also went up 1.5% showing that regular people are paying more too
Former BOJ expert Seisaku Kameda thinks service-costs are going up everywhere but notes its not super-fast: “The BOJ must be happy with how pay and service prices are moving up“
