Japan’s core inflation rate climbed at its fastest rate in more than two years in April, piling pressure on the Bank of Japan as it seeks to normalise the country’s interest rates and the unpopular government of Prime Minister Shigeru Ishiba.

Hotter-than-expected core inflation supports a Bank of Japan interest rate hike in July. The BoJ is expected to deliver a 25 bp hike and then stay put for a considerable time due to high uncertainty surrounding US tariffs.

Japan's core inflation accelerated at its fastest annual pace in more than two years in April on steady rises in food costs, data showed on Friday, raising the odds of another interest rate hike by year-end.