Japan Producer Prices Rise 0.1 Percent While Petroleum Subtracts 0.20 Points
Japan’s Producer Price Index rose 0.1 percent in July from the previous month, the Bank of Japan reported on 13 August 2026 in its preliminary monthly report on the Corporate Goods Price Index. The index excluding extra charges for summer electricity was unchanged on the month.
The trade indexes moved in opposite directions. The Export Price Index on a contract currency basis fell 0.6 percent from the previous month, while the Import Price Index on a contract currency basis rose 0.3 percent. The Bank publishes both indexes on two bases, yen and contract currency, and the contract currency measure strips out the effect of exchange rate movement, so it is the cleaner read on underlying price setting.
That combination, export prices falling and import prices rising in the currencies actually contracted, is a squeeze on Japanese exporters’ terms of trade in July. It is a small move in one month and should not be read as more than that.
What moved the index, by the Bank’s own contribution tables
The 0.1 percent monthly rise in producer prices is a small net figure over large offsetting movements. On the upside, electric power, gas and water contributed 0.23 percentage points, beverages and foods 0.07, non-ferrous metals 0.07, plastic products 0.05, electrical machinery and equipment 0.04, iron and steel 0.04, transportation equipment 0.03 and pulp and paper 0.02.
On the downside, petroleum and coal products subtracted 0.20 percentage points, with the Bank naming naphtha, jet fuel oil and gas oil. Chemicals subtracted 0.18, agriculture, forestry and fishery products 0.04, and scrap and waste 0.03.
| Japan, July 2026, contributions to the 0.1 percent monthly rise in producer prices | Percentage points |
|---|---|
| Electric power, gas and water | +0.23 |
| Beverages and foods | +0.07 |
| Non-ferrous metals | +0.07 |
| Plastic products | +0.05 |
| Electrical machinery and equipment | +0.04 |
| Iron and steel | +0.04 |
| Petroleum and coal products | −0.20 |
| Chemicals and related products | −0.18 |
Bank of Japan, preliminary figures for July 2026, released 13 August 2026. The index is calculated on a 2020 base of 100.
The same pattern appears on the export side. Of the 0.6 percent monthly fall in the Export Price Index on a contract currency basis, chemicals accounted for 0.34 percentage points and the group the Bank labels other primary products and manufactured goods for 0.21 points, with heavy oil B and C, jet fuel oil, kerosene and gasoline named as the commodities.
Energy did not push Japanese prices up in July. It pushed them down, on both tables the Bank publishes. Petroleum and coal products subtracted 0.20 points from the producer index, and refined oil products subtracted 0.21 points from the export index. Whatever lifted import prices in the month, it was not oil.
Why it matters
Japan is the third largest economy and a major buyer of Gulf crude and LNG, so its price indexes are partly a mirror of what our region charges. The July report says something more specific than a headline of 0.1 percent suggests: refined petroleum products were the single largest drag on Japanese producer prices in the month, and the largest identified drag on export prices in contract currency, at a time when Brent was settling above 88 dollars. That gap between crude and Japanese refined product pricing is the thing worth watching, because it is where a producer’s realised price and a buyer’s cost separate.
For the Bank of Japan the practical read is that a 0.1 percent monthly producer price rise built on utilities while oil products fell is not the kind of print that forces a policy response.
Outlook
The Bank of Japan is holding the uncollateralised overnight call rate at around 1.0 percent, decided at its meeting of 31 July 2026 on an eight to one vote. Its next monetary policy meeting is 17 and 18 September. The August Corporate Goods Price Index preliminary figures are due in mid September, before that meeting.
Sources: Bank of Japan, Monthly Report on the Corporate Goods Price Index, preliminary figures for July 2026, released 13 August 2026. Bank of Japan, Monetary Policy Meeting statement of 31 July 2026.
