A customer visits a store in Togoshi Ginza Street in Tokyo on January 23, 2025.
Philip Fong | AFP | Getty images
Japanese Inflation in January Broken by 4% over a year, reaching its highest level since January 2023, further strengthening the case of rate increases in the country’s central bank.
The central inflation rate – which excludes prices from fresh food – increased to 3.2% compared to 3% During the previous month and beat economists’ expectations by 3.1%, according to a Reuters survey. This figure was the highest since June 2023.
The “nucleus-nucleus” inflation rate, which removes fresh food and energy prices and is closely monitored by the BOJ, climbed slightly to 2.5% compared to 2.4% during the month previous.
The rate of inflation of the securities, which had reached 3.6% in December, remained above the target of 2% of the bank by 2% for 34 consecutive months.
Immediately after the release of data, the Yen strengthened 0.15% to negotiate at 149.39 against the dollar.
Inflation figures reinforce the case of rate increases by the BOJ, which deliberated tightening them at its January meeting, with its Summary of opinions Warning of inflation and weakness risks in the yen.
“It will be necessary that the bank adjusts the degree of monetary accommodation from the point of view of the avoidance of the amortization of the yen and the overheating of financial activities, which both seem to excessively high expectations of relaxation continuous monetary “, the summary of the Boj read.
The governor of Boj Kazuo Ueda would have said on Friday that the central bank was Ready to increase the purchase of government bonds If yields increase sharply.
Yields on the bonds of the Japanese government at 10 years old, which had evolved a 15 -year summit of 1.447% in the previous session on hiking expectations, fell to 1.402% on Friday, after having increased in the last four days .
UEDA comments come after the member of the Boj board of directors, Hajime Takata, reportedly said on Tuesday that the Japanese central bank was to increase interest rates more, as keeping them at a current level could cause taking excessive risk and higher inflation.
IPC data intervenes after growth in the country’s GDP, expectations of expectations of a third and annualized quarter, increasing by 0.7% and 2.8% respectively.
However, the growth of annual GDP for 2024 has slowed 0.1%, a sharp decrease of 1.5% growth observed in 2023.
In a note before inflation data, the Commonwealth Bank of Australia said that the case of an increase in previous rates has been strengthened in recent weeks due to high Japanese economic data.
Analysts from Bank of America wrote in a post earlier this week that the BOJ was also “increasingly concerned” by the risk of inflation, which will increase the possibility of previous increases and a more terminal rate pupil.
Analysts also provide that BOJ will increase in June and December and increase its terminal rate forecast to 1.5% with two additional increases in June 2026 and the first quarter of 2027.
