Japan's producer price index (PPI) rose 2.9% on year in June, but slipped 0.2% from May, according to data from the Bank of Japan on Thursday.

The annual PPI growth slowed from 3.3% in May.

Pushing up the PPI in May were beverages and foods, up 4.5% on year, electric power, gas and water bills, up 3.5%, and transportation equipment, up 2.1%, among other items.

Japan's export price index, on a contract currency basis (generally, US dollars) contracted 1.6% on year in June, while the import price index fell 6.1% on year, the Bank of Japan added.

The PPI measures prices at the factory gate, or those charged to businesses and distributors.

The Bank of Japan has a 2% annual target on the nation's consumer price index or CPI. The nation's CPI-core index, which strips out fresh food, was up 3.7% on year in May.