Inflation in Japan has hit its fastest pace in more than three decades, excluding tax hike distortions, creating headaches for the Bank of Japan this week as it seeks to explain why it needs to pursue monetary stimulus when inflation is well above its 2% target.

Consumer prices excluding fresh produce rose 2.8% in August from a year ago, the Interior Ministry reported on Tuesday. Analysts had expected a gain of 2.7%. It was the strongest reading since 1991, excluding the effect of sales tax increases.

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