Japan Kerninflation

Japan’s core consumer price index, which excludes fresh food but includes energy, rose 3% YoY in October 2025, the highest in three months and in line with expectations. The reading accelerated for a second straight month after 2.7% in August and 2.9% in September. Rising food costs drove the uptrend, reflecting poor harvests, especially in rice, and higher global grain prices. A sharply weaker yen also lifted import costs, adding to domestic inflation pressures. Core inflation remained well above the Bank of Japan’s 2% target, giving policymakers more room to raise interest rates. The data arrived as markets await a widely anticipated stimulus package from Prime Minister Sanae Takaichi’s government.