The Bank of Japan's measure of consumer inflation rose at an annual pace of 1.10% in February, unchanged from January's print. The weak inflation reading has sparked speculation of further policy action from the BoJ when it meets in April. Low energy costs and weaker consumption continued to put pressure on consumer prices. The core consumer price data in Tokyo saw the biggest annual drop in three years in March. Considered a leading indicator on consumer prices, the data suggests that inflation will remain subdued in the near term. The weak inflation data reinforces the market views that the BoJ could cut its inflation forecasts as well as the timing of reaching the 2.0% inflation target rate it has set for itself. BoJ's quarterly review is due to be released in April.
Upward GDP Revision Supports US Dollar
Daily Analysis - 28/03/2016