Japanese headline inflation likely to have accelerated in October, BoJ to maintain loose monetary policy

Japanese consumer price data for the month of October is set to be released. According to a DBS Bank, the headline inflation rate is likely to have accelerated to 1.4 percent year-on-year from September’s 1.2 percent. Meanwhile, the core CPI and core-core CPI is expected to have stayed stable at 1 percent and 0.3 percent, respectively.

The underlying price dynamic continues to be comparatively subdued for the time being, given the modest rise in wages and subdued consumption demand. The third quarter GDP data released recently was disappointing on all the fronts because of the deterioration in overseas demand and the disruptions of natural disasters.

“Macro picture suggests that the BOJ will maintain a loose monetary policy in the rest of this year and into 2019”, added DBS Bank.

At 11:00 GMT the FxWirePro's Hourly Strength Index of Japanese Yen was slightly bearish at -59.8273, while the FxWirePro's Hourly Strength Index of US Dollar was highly bullish at 120.937. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex