Domestic corporate service prices in Japan were down 3.6 percent on year in August, the Bank of Japan said on Thursday.
That missed forecasts for a decline of 3.3 percent following the 3.0 percent contraction in July.
On a monthly basis, prices eased 0.6 percent - also missing estimates for a fall of 0.4 percent after dipping 0.2 percent in July.
Export prices were down 0.9 percent on month and 6.1 percent on year, the bank said, while import prices tumbled 1.6 percent on month and 19.5 percent on year.
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