A shopper looks at bundles of vegetables at a market in a shopping district in Tokyo, Japan, December 6, 2015. REUTERS/Yuya Shino

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  • April core CPI up 2.1%, above BOJ’s 2% target
  • Core CPI jumps at fastest pace in 7 years
  • The gain suggests further inflationary pressure from fuel costs

TOKYO, May 20 (Reuters) – Core consumer inflation in Japan in April beat the central bank’s 2% target to hit a more than seven-year high as rising costs of energy and raw materials leading to a wider rise in prices which is putting pressure on households.

Rising consumer prices are making it harder for the Bank of Japan (BOJ) to convince markets that it will maintain extremely loose monetary policy and that the gains are fueling public concerns about the rising cost of living.

The national core consumer price index (CPI), which excludes the volatile costs of fresh food but includes those of energy, jumped 2.1% in April from a year earlier, revealed government data on Friday.

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That marked the fastest rise in a single month since March 2015 and matches the median forecast from a Reuters poll.

The gain was far larger than a 0.8% year-on-year rise in March, as the impact of April last year’s mobile phone charge cuts, which have lowered the headline CPI since then begins to fade compared to annual comparisons.

The overall rate of price increases in Japan remained modest compared to much stronger increases in the United States and other advanced economies, as weak wage growth in the world’s third-largest economy makes it harder for businesses to raise prices.

The BOJ has maintained its massive monetary stimulus as it seeks to keep inflation steady at 2% on the back of strong wage growth, even as a weaker yen drives oil prices higher. food and energy and that other major central banks are tightening their policies.

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Reporting by Daniel Leussink; Editing by Sam Holmes and Stephen Coates

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