Japan PPI Surges to 4.9% on Energy Costs, Boosts BOJ June Hike Odds Pre-G7

Japan's April PPI rocketed to +4.9% y/y, exceeding +3% forecasts and accelerating from March's +2.9%, propelled by petroleum (+5.3%), chemicals (+9.2%), and 17.5% yen-based import price surges tied to US-Iran tensions, oil shocks, and weak yen. This intensifies inflation pressures, elevating Bank of Japan June rate hike expectations amid 10-year JGB yields at 1997 peaks following ¥10 trillion interventions. Despite March household spending falling -2.9% y/y (worse than -1.5% expected), positives like US Treasury Secretary Bessent's praise for Japan's strong economy, trade deal progress, and Australia's Mogami frigate deal offer counterbalance as finance minister heads to G7 meetings from May 17.