Japan PPI for January is +4.2%y/y (expected +4.0% prior +3.9%)January 4.2%, December 3.9%, November 3.8% is the latest quarter's trend
The Bank of Japan (BOJ) is facing increasing inflationary pressures, with the latest corporate goods price index (CGPI) data showing a 4.2% rise in January—exceeding market expectations of 4.0% and accelerating from 3.9% in December. The data underscores persistent wholesale price inflation, which could feed into consumer prices in the coming months. BOJ Governor Kazuo Ueda acknowledged these pressures when he spoke in parliament yesterday, highlighting the risk that elevated food prices may continue to influence consumer inflation expectations.
Ueda reaffirmed that the pace of future interest rate hikes will depend on evolving economic conditions, including wage growth and broader inflation trends. The BOJ is also set to conduct a mid-term review in June to assess its government bond tapering plan, which aims to halve monthly Japanese government bond purchases to 3 trillion yen by early 2026. While the central bank remains committed to a gradual tightening process, Ueda emphasized that any adjustments will be made flexibly and predictably to maintain financial market stability.
I noted in the headline that the March BOJ meeting is live. I think May is much more likely than March, though.
This article was written by Eamonn Sheridan at www.forexlive.com. Read More Details
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