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Japan Inflation Reaccelerates to 3.0% in October, Putting BOJ’s December Decision in Focus

Persistent price gains are bolstering bets on a rate hike despite fresh signs of economic strain.

Overview

  • Core consumer prices rose 3.0% year over year in October after 2.9% in September, matching market forecasts.
  • The core-core gauge that excludes fresh food and energy advanced to 3.1%, indicating firm underlying pressures.
  • The Bank of Japan will assess the data at its December 18–19 meeting as markets lean toward a possible near-term increase.
  • Governor Kazuo Ueda highlights weak third‑quarter GDP and uncertainty from U.S. tariffs, emphasizing the need for wage-driven inflation.
  • Two of the nine policy board members advocated lifting rates to 0.75% at recent meetings, and Ueda met new Prime Minister Sanae Takaichi this week with no policy requests reported.