A leading indicator of Japan's service-sector inflation held near 3% in October, data showed on Tuesday, offering further evidence that conditions for another near-term interest rate hike by the Bank of Japan were falling into place.

Japan’s overall consumer inflation continued to slow in October, but a rise in underlying price pressures could further clear the path for the central bank to hike rates in December.

The Bank of Japan is watching service-sector inflation for clues on whether demand-driven price gains are broadening enough to justify further raising interest rates.

A leading indicator of Japan's service-sector inflation held near 3% in October, data showed on Tuesday, offering further evidence that conditions for another near-term interest rate hike by the Bank of Japan were falling into place.