Tokyo Inflation Jumps

Tokyo Core Inflation Accelerates in September, Bolstering Case for Bank of Japan Hikes

Annual core inflation in Japan's capital, Tokyo, accelerated in September, according to government data. The core consumer price index, excluding fresh food but excluding fuel costs, rose 2.7% from the previous year, exceeding a 2.4% gain. This increase increases the case for further interest rate hikes in the Bank of Japan (BOJ) as a leading indicator of nationwide trends. The data is expected to influence the Bank's fresh quarterly inflation forecasts at its next policy meeting on October 29-30. While government fuel subsidies have kept core consumer inflation below the BOJ's target, a recent spike in wholesale inflation has led to increased price pressure from the Middle East conflict, a weak yen, and robust AI-related demand.

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