FX.co ★ Japan Inflation Rate Stays at 7-Month High

Japan's annual inflation rate remained at 1.9% in August 2026, unchanged from July and still at its highest level since December 2025. Prices continued to rise across most categories, including food (3.1% vs 3.5% in July), transport (2.3% vs 2.6%), housing (1.0% vs 1.0%), household goods (4.9% vs 3.7%), clothing (1.5% vs 1.2%), healthcare (3.0% vs 2.1%), recreation (2.2% vs 1.9%), and miscellaneous items (0.7% vs 0.4%). Gasoline prices also accelerated (2.0% vs 1.8%), while electricity prices fell more sharply (-2.4% vs -0.1%), reflecting the impact of government energy subsidies. Education costs remained in deflation (-3.8% vs -3.8%). Core inflation, which excludes fresh food, eased slightly to 1.7% from 1.8% in July, staying below the Bank of Japan’s 2% target for the seventh consecutive month. On a monthly basis, consumer prices rose 0.1%, a notable slowdown from the upwardly revised 0.5% increase recorded in July.