Prices in Japan rose in November at the fastest pace since 1981, driven in part by higher energy costs, AFP reported.

Basic consumer prices, which exclude volatile fresh produce prices, rose 3.7 percent last month from a year earlier. Prices for processed foods jumped the most, as did electricity and durable goods such as air conditioners.

The November figure is well below the exorbitant levels that have caused concern in the U.S., the U.K. and elsewhere, but well above the Bank of Japan's long-term target of 2.0 percent. Even excluding fresh food and energy prices, the index rose 2.8 percent.

"Although low by international standards, Japanese consumer price inflation at three percent to four percent is high enough to feel uncomfortable with stagnant wage growth," wrote Sarah Tan, economist at Moody's Analytics.

The headline core consumer price index (CPI) has been rising steadily since the beginning of the year, forcing the Bank of Japan to adjust its long-standing policy of easing monetary policy.

The U.S. Federal Reserve and other central banks have raised interest rates sharply this year to fight inflation.

But Japan, which has oscillated between periods of sluggish inflation and deflation since the 1990s, has gone against the tide and continues to keep interest rates ultra-low in an attempt to give its economy a boost. The Bank of Japan says it considers the recent price increases to be temporary and that there is no reason to change course yet.

The very different approaches taken by the Bank of Japan and the Fed have caused the yen to fall against the dollar this year from 115 yen per dollar in March to 151 yen.

The currency has recovered somewhat thanks to government intervention.

This week Japan's central bank made an unexpected adjustment to its ultra-soft monetary policy, causing the yen to strengthen rapidly. Although the adjustment does not correspond to a rate hike, analysts say it could help stem the yen's depreciation.

Koya Miyamae, senior economist at SMBC Nikko Securities, said prices are likely to continue rising in the short term. "The core CPI rose in November due to rises in food prices and gas. The index will likely rise further, nearing or potentially rising above four percent in December," he told AFP.