Inflation data showed higher prices for bento boxed meals, chocolate, coffee beans, tuna, housing repairs and auto insurance. (EPA Images pic)TOKYO: Core inflation in Japan accelerated to 1.6% in June from 1.4%in May, official data showed Friday as the Middle East war and a weak yen pushed up prices.The reading from the internal affairs ministry, which excludes food prices, was in line with average market expectations.The ministry said that core inflation gathered pace as the cost of imported energy and oil-related products continued to drive up product prices.A falling yen - trading around 40-year lows against the US dollar - also increases the cost of imports like oil and food for resource-poor Japan.Excluding food and also energy prices, inflation was 1.7%, down from 1.8% in May and just below market expectations of 1.8%.Unadjusted, inflation was 1.7% after 1.5% in May and in line with market expectations.The prices of "bento" boxed meal sets rose, as did chocolate, coffee beans and tuna as well as housing repairs and maintenance and auto insurance, the data showed.The Bank of Japan is widely expected to keep interest rates unchanged on July 31, having hiked them to a 31-year high last month.Most economists predict the next increase in December.But Bloomberg News reported this week that policymakers were open to hiking at a faster pace owing to the effect on inflation from the weaker yen.Consensus among economists has been for an increase every six months or so.While surging oil prices and concerns over debt are major reasons for the yen's weakness, a key driver is the gap between BOJ interest rates and those in the United States and other big economies.
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