28.08.202523:45:47UTC+00Tokyo Core Inflation Slows for Third Month

In August 2025, core consumer prices in Tokyo's Ku-area experienced a year-on-year increase of 2.5%, marking a slowdown for the third consecutive month, which aligned with market expectations. Although inflation has somewhat eased, it still surpasses the Bank of Japan's 2% target, fueling speculation of a potential rate hike later in the year. Governor Kazuo Ueda recently highlighted that wages are anticipated to increase further, owing to a tightening labor market, which bolsters the belief that conditions are maturing for additional tightening measures. During its July meeting, the BOJ maintained interest rates but revised its inflation outlook upwards and expressed a more optimistic view of the economy. Policymakers have temporarily halted their cycle of rate increases, primarily due to concerns about the potential effects of US tariffs on Japan's export-dependent economy.