Japan's October headline inflation rate falls, but economists still see BOJ rate hike on the table

Japan’s headline inflation rate dropped to 2.3% in October, the lowest level since January, while the core inflation rate, excluding fresh food prices, also fell to 2.3% from September’s 2.4%. Despite being slightly higher than expected, the weak inflation figures suggest that the Bank of Japan may need to maintain an easy monetary policy stance. Economists predict a potential 25 basis point rate hike at the December meeting, with Governor Kazuo Ueda stating that sustained wage-driven inflation is on the horizon and cautioning against keeping borrowing costs too low.

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