Aug core CPI up 2.8 yryr, matches forecast
Index lest fuel rises 2.0 yryr in August
Data backs up BOJ view conditions in place for more rate hikes

TOKYO, Sept 20 Reuters Japan39;s core consumer inflation accelerated for the fourth straight month in August and tracked comfortably above the central bank39;s 2 target, data showed on Friday, keeping alive expectations for further interest rate hikes.

The data comes hours before the Bank of Japan concludes its twoday policy meeting, where it is widely expected to keep interest rates steady at 0.25.

The core consumer price index, which excludes volatile fresh food costs, rose 2.8 in August from a year earlier, matching a median market forecast. It followed a 2.7 rise in July.

A separate index stripping away both fresh food and fuel costs, which is scrutinised by the BOJ as a better gauge of demanddriven inflation, rose 2.0 in August from a year earlier. In July, the index was up 1.9.

While the yen has strengthened sharply in recent weeks, we think it will take at least half a year for lower input costs to be passed on to consumer prices, said Marcel Thieliant, head of AsiaPacific at Capital Economics.

Accordingly, underlying inflation should remain around 2 over the coming months, prompting another rate hike by the Bank of Japan at its October meeting, Thieliant said.

The BOJ ended negative interest rates in March and raised shortterm interest rates to 0.25 in July on the view inflation was on course to hit its 2…