Two of the three measures have shunted back below the Bank of Japan 2% target.

Tokyo headline for January 1.6% y/y

  • expected 2.0%, prior 2.4%

CPI Excluding Fresh Food 1.6% y/y, the slowest for this measure since March 2022

  • expected 1.9%, prior 2.1%

CPI Excluding Fresh Food and Energy 3.1%, the slowest for this measure since February 2023

  • expected 3.4%, prev 3.5%

The obvious caveat on reading too much into this data is that its not national level CPI. But ... that's unlikely to accelerate if Tokyo's is falling like this.

The "Excluding Fresh Food and Energy" is the closest measure to the US measure of core inflation, and that's still strong. Otherwise there isn't much in this data to support a Bank of Japan tightening.

USD/JPY is not showing a huge response. Yet. There is also not much in the data to support buying yen.

usdyen tokyo cpi collapse 26 January 2024


Tokyo area inflation data:

  • National-level CPI data for this month will follow in about three weeks, it takes longer to gather and collate the national data.
  • Tokyo CPI is a sub-index of the national CPI
  • It measures the change in prices of goods and services in the Tokyo metropolitan area
  • Its considered a leading indicator of national CPI trends because Tokyo is the largest city in Japan and is a major economic hub
  • Historically, Tokyo CPI data has been just slightly higher than national Japan CPI data. The cost of living in Tokyo is a touch higher than in most other parts of Japan. Higher rents, for example