Japan’s PPI increased 0.3% MoM (vs 0.4% MoM expected) and 3.8% YoY (vs 3.8% YoY expected) in December, remaining at the highest annual pace since June 2023.

• Energy goods are the main reason for the rise in PPI, accounting for around 0.28 ppts of the monthly increase.

• On a yen basis, export prices fell -0.5% MoM but were up 4.5% YoY, and import prices fell -1.0% MoM and were up 1.0% YoY. The recover of the yen in Q4 has helped make traded goods less expensive for firms than they were after the weakening of the currency in Q3.