MNI BRIEF: Japan Apr Tokyo Core CPI Rises 3.4% Vs. Mar 2.4%

The Tokyo core inflation rate accelerated to 3.4% y/y in April from March’s 2.4%, above the Bank of Japan's 2% target for the sixth straight month, data from the Ministry of Internal Affairs and Communications showed on Friday.

The 3.4% increase is the highest level since July 2023 when it rose 3.0%.

Food prices excluding perishables (+6.4% vs. +5.6%) and energy prices (+9.4% vs. +6.1%) boosted the result, despite slower households’ durable goods growth (+6.8% vs. +7.7%).

The core-core CPI, excluding fresh food and energy, rose 3.1% y/y in April, also up from March's 2.2% and above the target for the second straight month.

Processed food prices rose 4.1%, accelerating from March’s 3.5% and services prices increased 2.0% in April vs. March’s 0.8%.

The data underscored the BOJ’s view that the inflation rate is on track, supporting a rate hike path.

However, the downside risk to the economy caused by the U.S. trade policies will prevent the BOJ from raising the rate for the time being. (See MNI BOJ WATCH: Board Likely To Hold As Fed, Tariffs Weigh)

The BOJ will likely revise down its economic growth and inflation forecast this fiscal year at the two-day policy meeting ending on May 1.