Core inflation in Tokyo climbed to 2.5%, its fastest annual increase in nearly a year

The data is here from earlier:

• Tokyo area January inflation data: Headline 3.4% y/y (expected 3%, prior 3%)

Reacpping it:

Core inflation in Tokyo climbed to 2.5%

• marking its fastest annual increase in nearly a year
• surpassing the Bank of Japan’s 2% target, fueling market speculation over further interest rate hikes
• this core consumer price index (CPI) excludes volatile fresh food prices, rose in line with market expectations following a 2.4% increase in December

As a key indicator of nationwide inflation trends, the Tokyo CPI accelerated for the third consecutive month, with its annual rise matching the peak recorded in February last year.

Speculation of a March Bank of Japan interest rate hike is rising. BoJ Depgov Himino spoke Thursday:

• BOJ’s Himino says will raise rates if economy, prices move in line with forecast

Ueda is speaking in a little later today:

• Bank of Japan Governor Ueda is speaking soon – appearing in the Diet

This article was written by Eamonn Sheridan at www.forexlive.com.