A market in Tokyo in June 2023.
Richard A. Brooks | Afp | Getty Images
Japan’s headline inflation rate slipped to 2.3% in October, its lowest level since January and down from the 2.5% seen in September.
The core inflation rate, which excludes fresh food prices, came in at 2.3%, down from September’s 2.4%. The figure however, was slightly higher than the 2.2% expected among economists polled by Reuters.
Japan’s central bank has long stated that its goal is a “virtuous cycle between wages and prices.” A weak inflation reading could therefore mean that the bank would still need to maintain an easy monetary policy stance.
According to LSEG data, 55% of economists polled by Reuters as of Nov. 22 expect the BOJ to hike rates by 25 basis points at its December meeting, bringing the benchmark policy rate to 0.5%.
On Nov. 18, BOJ Governor Kazuo Ueda said the economy is heading toward sustained wage-driven inflation, and warned against keeping borrowing costs too low, Reuters reported.
The BOJ also said in its latest summary of opinions that if prices and Japan’s economy develop as it expects, the policy rate could reach 1% by the second half of its 2025 fiscal year at the earliest.
This is a developing story. Check back later for updates.
