Japan’s producer prices rose 6.8% year-on-year in September 2026, slowing from August’s pace and market expectations of 7.6% and marking the weakest growth since May. The moderation suggests easing upstream cost pressures, although producer inflation remained elevated. Prices moderated for transport equipment (2.3% vs 2.5% in August), drinks and foods (4.2% vs 4.3%), petroleum & coal (11.5% vs 14.7%), production machinery (4.3% vs 4.5%), and textiles (1.4% vs 2.2%). Meanwhile, costs accelerated for chemicals (13.3% vs 13.0%), iron & steel (3.2% vs 2.7%), electrical machinery (5.1% vs 4.9%), metal products (5.1% vs 3.8%), electronic components (4.9% vs 4.4%), and information and communications (15.3% vs 14.8%).On a monthly basis, producer prices fell 0.3%, matching the revised decline in August and marking a second consecutive monthly contraction. The result also defied market expectations for a 0.5% increase.