June core CPI rises 3.1 yryr, matching forecast
Corecore CPI accelerates as service prices pressure persists
Analysts see BOJ sticking to easy policy for now

TOKYO, Aug 18 Reuters Japan39;s core consumer prices slowed in July, supporting expectations the Bank of Japan BOJ will be in no rush to phase out monetary easing, even as inflation remains stubbornly above the central bank39;s target.

The 3.1 rise in the core consumer price index CPI, which includes oil products but excludes volatile fresh food prices, matched a median market forecast, following a 3.3 increase the previous month. It held above the BOJ39;s 2 inflation target for the 16th straight month.

The socalled corecore inflation index, which excludes fresh food and energy prices and is closely watched by the BOJ as a better gauge of trend inflation, rose 4.3 yearonyear in July, accelerating from the previous month.

The central bank argues that wage pressures have yet to build up enough to warrant a fresh tweak to the ultraloose monetary stance.

Still, analysts say an acceleration in serviceled inflation is a positive sign that demandside inflation, which the BOJ is looking to stoke, may be building.

The data confirmed that price pressures are rising in the servicesector such as accommodation as well as food, while import inflation including energy is calming down, said Takeshi Minami, chief economist at Norinchukin Research Institute.

Gabriel Ng, economist at Capital Economics, said the key question…