Japan's CSPI Eases Slightly as BOJ Prepares for Rate Decision

Japan's Corporate Service Price Index (CSPI) has shown a slight moderation in price pressures, rising by 3.2% year on year in June. This easing from a 3.3% increase in the previous reading suggests that inflationary pressures in services provided between companies are starting to cool down.

The Bank of Japan is expected to maintain its current interest rate stance on Friday, but with room for further hikes as it navigates mounting inflationary pressure due to the Middle East war, a weak yen, and robust global AI demand. However, the central bank will likely keep its communication ambiguous regarding the pace and timing of future rate hikes.