Japan's core consumer price index rose 2.1% in September from a year earlier, exceeding the Bank of Japan's 2% target for the first time this year, according to the Ministry of Internal Affairs and Communications. The index excluding both fresh food and energy, a key gauge of underlying inflation, advanced 2.4%, while overall CPI also climbed 2.1%. The data reinforces expectations for a BOJ rate hike in December, with over 80% of economists surveyed by Bloomberg forecasting an increase.
The yen strengthened to a one-month high against the dollar following the report. Price gains were driven by hotel, water, and food costs, though a gasoline tax cut offset energy expenses. Service prices rose 1.5%, the fastest pace since March, and food prices excluding fresh items accelerated to 2.9%.
Major companies including Central Japan Railway and Uniqlo parent Fast Retailing announced price hikes this month. Prime Minister Sanae Takaichi's cabinet approved a bill to temporarily cut the sales tax on food for two years from April to ease household cost-of-living pressures.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing