Japan’s core CPI growth slowed to 1.4% YoY in April, the weakest pace since 2020, pressuring the yen ahead of BOJ’s June policy meeting.
The USD/JPY pair climbed to 159.10 in early Asian trading Friday after Japan’s core Consumer Price Index rose 1.4% year-over-year in April, down from 1.5% in March. The print marked the slowest annual inflation pace in four years, weighing on the yen.
Analysts had anticipated a modest slowdown but expect inflation to rebound in coming months due to higher oil prices and supply disruptions linked to Middle East tensions. The Bank of Japan is widely expected to raise its short-term policy rate to 1.0% from 0.75% at its June meeting, though Friday’s data may fuel debate over the timing.
The yen weakened immediately after the release, while traders await the US Michigan Consumer Sentiment Index later Friday. Fed minutes released Wednesday showed officials remain concerned about persistent inflation, keeping rate hike risks alive.