(MaceNews) – Here are the key Japanese economic events for the coming week. There is no major movement on the political front.

Producer inflation is expected to show some signs of more stability in the October report, which may have an easing effect on consumer inflation in about six months. The core CPI (excluding fresh food) picked up to +2.9% in September from +2.7% in August, largely in light of a technical year-on-year rise in overall energy triggered by a sharp slowdown in subsidized electricity costs in September 2024.

– Monday, Nov. 10

1240 JST (0340 GMT Monday, Nov. 10/2240 EST Sunday, Nov. 9) Bank of Japan board member Junko Nakagawa, a former Nomura Securities executive, delivers a speech to a business audience in Okayama City, western Japan. No news conference is scheduled after the speech.

At its last meeting on Oct. 29-30, the Bank of Japan’s nine-member board, as expected, decided in a 7 to 2 vote to maintain the target for the overnight interest rate at 0.5% for the sixth straight meeting amid uncertainty over the emerging effects of the protectionist U.S. trade policy, geopolitical risks and financial markets. The board wanted to see the stimulus effects of an economic revival package planned under Prime Minister Sanae Takaichi who took office on Oct. 21. The bank last hiked the rate by 25 basis points (0.25 percentage point) in January.

In the quarterly Outlook Report, the BOJ repeated that it would “continue to raise the policy interest rate and adjust the degree of monetary accommodation” if growth and inflation evolve in line with its medium-term outlook but it is still in the process of normalizing its monetary policy stance from years of keeping short-term rates near zero percent.

As in September, two members from the financial industry, Hajime Takata and Naoki Tamura, called for raising the target for the overnight interest rate by 25 basis points to 0.75%. Takata, a former Mizuho Securities executive, argued again that that the bank’s 2% price stability target had been largely met. Tamura, formerly with SMBC, urged the central bank to raise the policy rate closer to what is considered to be neutral to economic activity amid rising inflation risk.

– Monday, Nov. 10

1400 JST (0500 GMT/0000 EST Monday, Nov. 10) BOJ releases September consumption activity index. The supply-side index marked the second straight month-on-month drop in August, down a seasonally adjusted 0.4, after falling 0.5% in July and rising 0.7% in June. The index dipped 0.5% on quarter in the July -August period after edging up 0.1% in the second quarter. Figures exclude inbound tourism consumption but include outbound tourism spending.

This indicator tends to move in tandem with private consumption in revised GDP data. The preliminary gross domestic product for the July-September quarter, due on Nov. 17, is forecast to show its first contraction in six quarters, down 0.7% on quarter, or an annualized 2.7%, after growing 0.5% (2.5% in annual rate) as the drag from U.S. trade rows hurts business investment and exports while resilient consumption remains sluggish.

– Thursday, Nov. 13

0850 JST (2350 GMT/1850 EST Wednesday, Nov. 12) The Bank of Japan releases the October corporate goods price index.

Mace News median: CGPI +2.6% y/y (range: +2.3% to +2.7%) vs. Sept +2.7%; +0.4% m/m (range: +0.2% to +0.5%) vs. Sept +0.3%

Producer inflation in Japan measured by the corporate goods price index is expected to post a 2.6% increase on year in October, easing slightly from a 2.7% gain in September, thanks to falling prices for iron and steel, chemicals and crude oil. Farms produce costs for firms remain elevated but have moderated from above 40% to 30% in recent months after domestic supply shortages have been more or less resolved (the consumer inflation rate for the national staple has fallen fast to under 50% from over 100% seen in the early parts of the year).

The year-on-year increase in the CGPI decelerated to a 15-month low of 2.5% in July (the slowest since 1.2% in April 2024) from an upwardly revised 2.8% in June after having hit a recent peak of 4.3% in each of February and March this year (the highest since 4.5% in June 2023).

The lingering headache for all sectors is the depreciation of the yen, which pushes up import costs. The monthly average dollar/yen exchange rate during the Tokyo trading hours rose to Y151.28 in October from Y147.94 in September and a recent low of Y144.50 in June, according to the BOJ. The U.S. unit stood at Y149.63 in October 2024.

On the month, the CGPI is forecast by economists to mark a second straight rise after a 0.3% gain in September and a 0.2% dip in August. The September increase was driven by higher prices for farm products (brown rice, polished rice and chicken eggs), nonferrous metals (copper, unwrought gold and plastic insulated copper wires) and fuels (gasoline, diesel and heating oil).