The Consumer Price Index (CPI), which measures inflation in Japan, rose to its highest rate in 41 years, according to data issued by the Japanese government this morning, Friday, January 20. It reached levels of 4% in December, compared to 3.7% in the November reading, matching expectations.
In details, food prices in Japan increased by 7.4% in December, the highest level in 46 years, while energy prices rose by 15.2%, compared to 13.3% in November, while services prices also increased by 0.8%.
These numbers, which are double the Bank of Japan’s target of 2%, raise the market’s expectations that it will begin to tighten monetary policy, raise interest rates, and get rid of the policy of controlling the yield curve.
The Japanese yen is trading this morning at 129.04 levels, declining by 0.54% against the US dollar, while the yield on Japanese government bonds for 10 years is trading below the bank’s target, trading at 0.405.
01/11/2024
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