Inflation data will be the focus of the holiday-shortened week in Japan

Inflation data will be the focus of the holiday-shortened week in Japan (Silver Week holidays from Monday to Wednesday). August Nationwide Core CPI excluding fresh food (Friday) is expected to drop by -0.2% y/y (consensus: -0.1%), the first negative reading since April 2013. However, Bank of Japan (BoJ) introduced a new measure of CPI, excluding fresh food and energy, in its July Monthly Report, on which they now focus to assess the core inflation dynamics without the energy component. Their "new CPI" in July accelerated to +0.9% y/y from the Jan-Feb bottom of +0.4%. 

"We do not expect the additional monetary easing this year. USDJPY will likely remain under pressure, given the dovish FOMC last week but will also likely remain prone to fluctuations in global risk sentiments", says Barclays.