Japan inflation cools sharply in January, easing near-term pressure on the BoJ.<\/p>\n
Summary:<\/p>\n
Headline CPI y\/y: 1.5% (exp. 1.6%, prev. 2.1%) \u2014 lowest since March 2022.<\/p>\n
Core CPI (ex fresh food) y\/y: 2.0% (exp. 2.0%, prev. 2.4%).<\/p>\n
Core-core CPI (ex food & energy) y\/y: 2.6% (exp. 2.7%, prev. 2.9%).<\/p>\n
National CPI ex fresh food & energy y\/y: 2.6% (prev. 2.9%).<\/p>\n
CPI m\/m: -0.1% (prev. -0.1%).<\/p>\n
Inflation run above the 2% BoJ target ends after 45 straight months.<\/p>\n
BoJ recently upgraded FY2026 inflation forecasts despite expected near-term dip.<\/p>\n
Growth backdrop remains soft after Q4 GDP of just 0.1% q\/q<\/p>\n
Japan\u2019s inflation cooled markedly in January, with headline consumer prices rising just 1.5% y\/y, down from 2.1% in December and below the 1.6% consensus forecast. The reading marks the lowest annual inflation rate since March 2022 and ends a 45-month streak during which inflation remained above the Bank of Japan\u2019s 2% target.<\/p>\n
On a monthly basis, CPI fell 0.1% m\/m, unchanged from December.<\/p>\n
Core inflation measures also eased. The widely watched core CPI (excluding fresh food) slowed to 2.0% y\/y, matching expectations but down from 2.4% previously. The \u201ccore-core\u201d gauge, excluding both fresh food and energy, declined to 2.6% y\/y from 2.9%, slightly below the 2.7% expected. <\/p>\n
The slowdown aligns with the Bank of Japan\u2019s recent guidance that year-over-year inflation is likely to fall below 2% in the first half of 2026, reflecting stabilising food prices and government measures aimed at easing living costs.<\/p>\n
Despite the softer January print, the BoJ upgraded its fiscal 2026 inflation projections in its latest outlook. Core CPI is now seen at 1.9% (up from 1.8%), while core-core inflation is forecast at 2.2% (up from 2.0%). The central bank continues to balance moderating price pressures against wage dynamics and domestic demand resilience.<\/p>\n
On the political front, Prime Minister Sanae Takaichi recently secured a landslide election victory, with her Liberal Democratic Party winning 316 seats in the Lower House. Among her pledges is a two-year suspension of the 8% food tax, a measure that could further dampen near-term inflation readings.<\/p>\n
For markets, the key tension is between easing headline inflation, which reduces immediate pressure for tightening, and the BoJ\u2019s medium-term inflation outlook, which still anticipates underlying price strength stabilising near target.<\/p>\n","protected":false},"excerpt":{"rendered":"Japan inflation cools sharply in January, easing near-term pressure on the BoJ. Summary: Headline CPI y\/y: 1.5% (exp.…\n","protected":false},"author":2,"featured_media":300691,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[114,184,85,46,151726],"class_list":["post-300690","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-il","tag-israel","tag-japan-inflation-momentum-fades"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/300690","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=300690"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/300690\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/300691"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=300690"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=300690"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=300690"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}