Tokyo August 2025 headline CPI 2.6% y/y (2.6% expected) | investingLive

Tokyo headline CPI 2.6% y/y

• expected 2.6%, prior 2.9%

CPI excluding fresh food 2.5% y/y

• expected 2.5%, prior 2.9%

CPY excluding fresh food & energy (a gauge of underlying inflation) +3.1% y/y, the highest since January 2024

• expected 3.0%, prior 3.1%

These sort of inflation levels, all well above the Bank of Japan 2% target, keeps the BoJ on track to raise short term rates. Consumer inflation has held above 2% for well over three years. This has been accompanied by sustained nominal wage rises.

The BOJ raised short-term interest rates to 0.5% in January. Since then BOJ Governor Kazuo Ueda has stressed the need to move carefully on further rate hikes, citing an expected hit to the economy from US tariffs.

Yesterday we had Bank of Japan monetary policy board member Nakagawa emphasising data dependence, although the focus she mentioned was the next Tankan report (which should be due on September 30 or October 1)