Tokyo’s core-core CPI rose to 2.0% y/y in August, nearing the BOJ’s target and bolstering expectations for a September rate hike.
Tokyo’s core-core consumer price index, the Bank of Japan’s preferred inflation gauge, climbed to 2.0% year-over-year in August, up from 1.8% in July. The reading sits just 2 basis points below a key threshold, reinforcing expectations for a rate increase at the BOJ’s September 17-18 meeting.
The data exceeded forecasts, with core CPI rising 1.8% y/y against a 1.7% estimate. Headline CPI matched expectations at 1.9% y/y, down from 2.0% in July. Wholesale inflation accelerated sharply to 7.2% in July, signaling persistent cost pressures from Middle East supply chain disruptions.
The BOJ raised rates to a 31-year high of 1.0% in June but held steady in July. Recent comments from the central bank hinted at a potential shift to a more aggressive tightening pace, with this inflation print adding weight to near-term policy action.