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Japan Inflation Cools as TEPCO Pauses Reactor and New Opposition Launches

Persistent 2.9% core-core inflation keeps a 0.75% BOJ hold in view.

Overview

  • Core CPI rose 2.4% year-on-year in December, down from 3.0% in November, with the slowdown largely tied to energy base effects.
  • Inflation excluding fresh food and fuel held at 2.9%, reinforcing expectations the BOJ will leave its policy rate unchanged at 0.75% while retaining a tightening bias.
  • TEPCO said it will shut down the just-restarted Kashiwazaki-Kariwa reactor after an alarm sounded during control-rod withdrawal, the utility’s first restart since 2011.
  • The Centrist Reform Alliance formally launched as the largest opposition in the lower house, fielding over 220 candidates and pledging to scrap the consumption tax on food starting this fall.
  • The United States said it has completed its withdrawal from the WHO, and President Donald Trump said Xi Jinping will visit the U.S. toward the end of 2026 as he plans a trip to China in April.