Tokyo Core Inflation Rate Surges to 10-Month High

The Bank of Japan will be closely watching Tokyo's core inflation rate after it jumped to its fastest pace in 10 months, according to data released on October 2. The annual core inflation rate rose 2.7% in September from a year earlier, exceeding the median market forecast and the BOJ's 2% target for the first time since January.

This marks the fastest year-on-year pace since a 2.8% rise in November last year. The core consumer price index, which excludes fresh food but includes fuel costs, accelerated from a 1.8% gain in August and is considered a leading indicator of nationwide trends.

Senior economist Masato Koike at Sompo Institute Plus expects the BOJ to raise interest rates in December due to rising energy costs from the Middle East conflict and subsequent second-round effects.