Core Insights - Japan's core consumer price index (CPI) excluding fresh food rose by 3.1% year-on-year in July, reaching 111.6, marking the eighth consecutive month of inflation above 3% [1] - The primary driver of rising prices in Japan is the accelerated increase in food prices, with significant hikes observed across various categories including grains, snacks, cooking food, dining out, meat, and beverages [1] - The price of ordinary japonica rice surged by 89.9%, while coffee beans and chocolate saw increases of 51.0% and 44.4% respectively [1] - Mobile communication fees and hotel accommodation costs rose by 11.8% and 6.0% respectively [1] - The inflation rate in July showed a decline compared to the previous month, partly due to government subsidies on gasoline prices and summer electricity and gas fees [1] - A comprehensive tuition fee waiver policy for public high schools implemented in April has led to a year-on-year decrease in education service prices [1] - Economists suggest that achieving a virtuous cycle of rising prices and wages in Japan may still require time, as general service prices reflecting wage trends have also shown a year-on-year slowdown, and real wages continue to decline [1]