Japan wholesale inflation falls at record pace

The decline in the Corporate Goods Price Index, which measures wholesale inflation in Japan, accelerated from a downwardly revised year-over-year rate of -6.7% in June to -8.5% in July, the biggest drop on record.

The fall comes just one day after the Bank of Japan acknowledged that core deflation (my term) has worsened. However, crude oil prices are off the lows, the BoJ sees a moderation later in the year, and the month-over-month rate did rise 0.4%.

Japan's economy was mired in deflation for much of the decade, and the worst global recession since WWII has caused inflation to slip back below zero. The BoJ does not see a new deflationary spiral, but it kept its key lending rate at 0.10% as policymakers try to right the world's second-largest economy and turn the country towards price stability.