Japan's corporate service prices rose 3.7% in September from a year earlier, according to Bank of Japan data released on 27 October 2026. The services producer price index tracks the prices companies charge each other for services, and is closely watched for signs that rising labour costs are being passed through into prices.

The September rise followed a revised 3.5% increase in August, meaning the latest figure marks an acceleration rather than a steady pace. The index covers areas including transport, communications, finance, real estate, advertising and equipment leasing, all of which are heavily affected by labour costs.

Why the Bank of Japan is watching

The data arrive days before the Bank of Japan's two-day policy meeting, concluding on Friday. The bank is expected to keep interest rates steady at 1.25%, after raising rates in September, while signalling readiness to raise borrowing costs further if price pressures persist.

By contrast, goods producer price inflation slowed to 6.8% in September from 7.6% in August. That contrast suggests domestic, labour-driven service price pressure is proving more durable than imported cost pressure, a key question for policymakers judging whether inflation can remain around the bank's 2% target.

Sources: Reuters, Business Today