Japan’s Tokyo CPI inflation eases to 2.5% YoY in September – Crypto News – Crypto News
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Japan’s Tokyo CPI inflation eases to 2.5% YoY in September – Crypto News

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The headline Tokyo Consumer Price Index (CPI) for September rose 2.5% YoY as compared to 2.6% in the previous month, the Statistics Bureau of Japan showed on Friday.

Additionally, Tokyo CPI ex Fresh Food climbed 2.5% YoY in August against 2.8% expected and remained unchanged from 2.5% in the prior month. The Tokyo CPI ex Fresh Food, Energy rose 2.5% YoY in September, compared to the previous reading of 3.0%.

USD/JPY reaction to the Tokyo Consumer Price Index data

As of writing, the USD/JPY pair was up 0.65% on the day at 149.87.

Japanese Yen Price Last 7 Days

The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies last 7 days. Japanese Yen was the weakest against the US Dollar.

USD EUR GBP JPY CAD AUD NZD CHF
USD 1.31% 2.33% 1.96% 1.24% 1.83% 3.47% 1.42%
EUR -1.31% 0.87% 0.65% -0.05% 0.49% 2.24% 0.14%
GBP -2.33% -0.87% -0.22% -0.93% -0.39% 1.27% -0.73%
JPY -1.96% -0.65% 0.22% -0.70% -0.20% 1.46% -0.50%
CAD -1.24% 0.05% 0.93% 0.70% 0.56% 2.35% 0.19%
AUD -1.83% -0.49% 0.39% 0.20% -0.56% 1.76% -0.36%
NZD -3.47% -2.24% -1.27% -1.46% -2.35% -1.76% -1.96%
CHF -1.42% -0.14% 0.73% 0.50% -0.19% 0.36% 1.96%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).

This section below was published at 22:27 GMT as a preview of the Japan’s Tokyo Consumer Price Index (CPI) data

The Japan Tokyo CPI Overview

Statistics Bureau of Japan will publish its data for September on Friday at 23.30 GMT. The Tokyo CPI measures the price fluctuation of goods and services purchased by households in the Tokyo region excluding fresh food, whose prices often fluctuate depending on the weather. The index is widely considered as a leading indicator of Japan’s overall CPI as it is published weeks before the nationwide reading. 

The headline Tokyo Consumer Price Index (CPI) for August rose 2.6% YoY as compared to 2.9% in the previous month, while the Tokyo CPI ex Fresh Food, Energy rose 3.0% YoY in August versus 3.1% prior.

Tokyo CPI ex Fresh Food is expected to show a rise of 2.8% YoY in September, compared to the previous reading of 2.5%.

How could the Japan Tokyo CPI affect USD/JPY?

USD/JPY trade on a positive note on the day in the lead up to the Japan Tokyo CPI report. The major pair gains ground as the US Dollar strengthens following the upbeat US economic data, while Federal Reserve (Fed) officials gave mixed remarks regarding the Fed’s rate path.

If data comes in hotter than expected, it could lift the Japanese Yen  (JPY), with the first upside barrier seen at the 150.00 psychological level. The next resistance level emerges at the July 31 high of 150.84, en route to the March 28 high of 151.21.

To the downside, the July 15 high of 149.02 will offer some comfort to buyers. Extended losses could see a drop to the September 24 low of 147.52. The next contention level is located at the August 29 low of 146.76.

Economic Indicator

Tokyo Consumer Price Index (YoY)

The Tokyo Consumer Price Index (CPI), released by the Statistics Bureau of Japan on a monthly basis, measures the price fluctuation of goods and services purchased by households in the Tokyo region. The index is widely considered as a leading indicator of Japan’s overall CPI as it is published weeks before the nationwide reading. The YoY reading compares prices in the reference month to the same month a year earlier. Generally, a high reading is seen as bullish for the Japanese Yen (JPY), while a low reading is seen as bearish.



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Bank of Japan FAQs

The Bank of Japan (BoJ) is the Japanese central bank, which sets monetary policy in the country. Its mandate is to issue banknotes and carry out currency and monetary control to ensure price stability, which means an inflation target of around 2%.

The Bank of Japan embarked in an ultra-loose monetary policy in 2013 in order to stimulate the economy and fuel inflation amid a low-inflationary environment. The bank’s policy is based on Quantitative and Qualitative Easing (QQE), or printing notes to buy assets such as government or corporate bonds to provide liquidity. In 2016, the bank doubled down on its strategy and further loosened policy by first introducing negative interest rates and then directly controlling the yield of its 10-year government bonds. In March 2024, the BoJ lifted interest rates, effectively retreating from the ultra-loose monetary policy stance.

The Bank’s massive stimulus caused the Yen to depreciate against its main currency peers. This process exacerbated in 2022 and 2023 due to an increasing policy divergence between the Bank of Japan and other main central banks, which opted to increase interest rates sharply to fight decades-high levels of inflation. The BoJ’s policy led to a widening differential with other currencies, dragging down the value of the Yen. This trend partly reversed in 2024, when the BoJ decided to abandon its ultra-loose policy stance.

A weaker Yen and the spike in global energy prices led to an increase in Japanese inflation, which exceeded the BoJ’s 2% target. The prospect of rising salaries in the country – a key element fuelling inflation – also contributed to the move.

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