Japan’s Core CPI Slides to the Lowest Level Since April 2017 - Forex News by FX Leaders

Japan’s Core CPI Slides to the Lowest Level Since April 2017

Posted Friday, October 18, 2019 by
Arslan Butt • 1 min read

Japan’s core CPI weakened to the slowest pace since April 2017 during September as a fallout effect of the ongoing US-China trade war and the overall slowdown in the global economy. Japan’s core CPI came in at +0.3% for September, matching economists’ forecast. Consumer prices, excluding fresh food and energy costs, rose by 0.5% YoY in September.

Inflation in Japan is well below BOJ’s target of around 2%, which indicates that the central bank could expand its stimulus efforts to lend further support to the already strained Japanese economy. According to a recent Reuters poll, around 67% of economists expect BOJ to loosen its monetary policy at the upcoming meeting later this month, while over 75% of economists expect rates to dive further into negative territory.

On the positive side, the Japanese government expects its GDP to gain a 0.8% rate of growth once the trade between the US and China is finalized. The phase 1 trade deal which is expected to be signed next month could add around 4 trillion yen to Japan’s GDP and add around 280k new jobs as well.

On the release of Japan’s core CPI figures, the Japanese yen remains mostly unaffected with USD/JPY continuing to trade steady around 108.57.

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About the author

Arslan Butt // Index & Commodity Analyst
Arslan Butt is our Lead Commodities and Indices Analyst. Arslan is a professional market analyst and day trader. He holds an MBA in Behavioral Finance and is working towards his Ph.D. Before joining FX Leaders Arslan served as a senior analyst in a major brokerage firm. Arslan is also an experienced instructor and public speaker.
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