Japan's core inflation rate accelerated in April to 3.5 percent as rice prices almost doubled year-on-year, official data showed Friday.

The consumer price reading, excluding fresh food, up from 3.2 percent the previous month, was slightly above the market forecast and will likely cement expectations that the Bank of Japan will increase interest rates.

Excluding energy as well, prices rose 3.0 percent compared to 2.9 percent in March, according to the internal affairs ministry.

Overall unadjusted inflation was 3.6 percent, the same level as in March.

Underlying inflation has been above the BoJ's target rate of two percent for around three years.

However, uncertainty stemming from US President Donald Trump's trade policies could prompt the central bank to stick to its current stance for now.

The BoJ at its last meeting in early May kept its main interest rate steady.

But it warned that tariffs were fuelling global economic uncertainty and revised down its economic growth forecasts for Japan.

Rice

After several decades of stagnant or falling prices, inflation returned to Japan in the wake of the Russian invasion of Ukraine in 2022.

This has become a political headache for the government, in particular when it comes to the cherished national staple of rice.

The official data released Friday showed rice prices up a whopping 98.4 percent compared to April 2024 following a 92.5-percent increase in March.

The price rise has prompted Japan's government to release some of its emergency stockpile into the market.

Factors behind the shortfall include poor harvests due to hot weather in 2023 and panic-buying prompted by a "megaquake" warning last year.

Record numbers of tourists have also been blamed for a rise in consumption while some traders are believed to be hoarding the grain.

This week Japan's farm minister resigned after a gaffe about rice that drew public fury.

Taku Eto told a gathering over the weekend that he had "never bought rice myself because my supporters donate so much to me that I can practically sell it".

After Eto's resignation, Prime Minister Shigeru Ishiba said: "I apologise to Japanese people" as "it is my responsibility that I appointed him".

"That rice prices are remaining high is not a one-time phenomenon but is a structural one, I think. We have to have thorough discussions on this and they (rice prices) have to fall, of course," he said.

Marcel Thieliant at Capital Economics said that "weekly rice prices are showing signs of stabilisation so rice inflation should start to soften again before long".

He added that he expects the BoJ "to tighten policy further this year."

Iranian and US negotiators will resume talks on Friday in Rome to resolve a decades-long dispute over Tehran's nuclear ambitions, despite Iran's supreme leader warning that clinching a new deal might be insurmountable amid clashing red lines.

The stakes are high for both sides. President Donald Trump wants to curtail Tehran's potential to produce a nuclear weapon that could trigger a regional nuclear arms race. Iran, for its part, wants to be rid of devastating sanctions on its oil-based economy.

Iranian Foreign Minister Abbas Araqchi and Trump's Middle East envoy Steve Witkoff will hold a fifth round of talks, through Omani mediators, despite both Washington and Tehran taking a tough stance in public over Iran's uranium enrichment.

Although Iran insists the talks are indirect, US officials have said the discussions — including the latest round on May 11 in Oman — have been both "direct and indirect".

Tehran and Washington have both said they prefer diplomacy to settle the standoff, but they remain deeply divided on several red lines that negotiators will have to circumvent to reach a new nuclear deal and avert future military action.

US Secretary of State Marco Rubio said on Tuesday that Washington is working to reach an agreement that would allow Iran to have a civil nuclear energy program but not enrich uranium, while admitting that achieving such a deal "will not be easy."

Supreme Leader Ayatollah Ali Khamenei, who has the last say on state matters, rejected Washington's demands that Tehran stop enriching uranium as "excessive and outrageous", warning that the talks are unlikely to yield results.

Among the remaining stumbling blocks is Tehran's refusal to ship all of its highly enriched uranium stockpile abroad or engage in discussions over its ballistic missile programme.

Iran says it is ready to accept some limits on its uranium enrichment but needs watertight guarantees Washington would not renege on a future nuclear accord.

Trump, who has restored a "maximum pressure" campaign on Tehran since February, ditched a 2015 nuclear pact between Iran and six world powers in 2018 during his first term and reimposed sweeping US sanctions that have devastated Iran's economy.

Iran responded by escalating enrichment far beyond the 2015 pact's limits.

The cost of failure of the talks could be high. While Tehran says its nuclear work is for peaceful purposes, Iran's arch-foe Israel has said it would never allow Iran's clerical establishment to obtain nuclear weapons.

Araqchi warned on Thursday that Washington will bear legal responsibility in the event of an Israeli attack on Iranian nuclear facilities, following a CNN report that Israel might be preparing strikes on Iran.

While rising US-Iran tensions over Tehran's uranium enrichment jeopardise nuclear talks, three Iranian sources said on Tuesday that the clerical leadership lacks a clear fallback plan if efforts to overcome the standoff collapse.