Japan's core inflation cooled to 3.3% in June, coming down from a 29-month high of 3.7% as rice inflation showed signs of easing. The figure — which strips out costs for fresh food — was in line with the 3.3% expected by economists polled by Reuters. Headline inflation in the country dropped to 3.3%, coming down from 3.5% in May.

The report on producer prices adds to a mixed picture for inflation as the economy adjusts to the imposition of import tariffs.

A weaker U.S. dollar may fundamentally benefit some areas of the stock market, but “it could also potentially drive higher import costs, pressure consumers and flow through to inflation,” according to a note Thursday from Morgan Stanley Wealth Management.

The figure for June marks the fastest rate of inflation, which measures how quickly prices are rising, since January 2024.

A number of factors, including a lack of significant gains in auto prices, are masking the extent of the shift.