People looks at the fruits at a shop at the Tsukiji Outer Market in Tokyo on August 22, 2025. (Photo by Philip FONG \/ AFP) (Photo by PHILIP FONG\/AFP via Getty Images) <\/p>\n
Philip Fong | Afp | Getty Images<\/p>\n
Japan’s consumer inflation rate dropped to 2.9% in November, staying above the 2% target set by the country’s central bank for a 44th straight month, and further strengthening already strong prospects of a rate hike. <\/p>\n
Core inflation, which strips out prices of fresh food, remained unchanged from 3% in October, and came in line with Reuters-polled economists’ average estimate.<\/p>\n
This data comes as the Bank of Japan is poised to raise rates to their highest level since 1995 as it concludes its 2-day policy meeting later in the day. <\/p>\n
The so-called “core-core” inflation rate, which excludes food and energy prices, fell to 3% from 3.1%. <\/p>\n
Rice inflation slowed for a sixth straight month, coming in at 37.1%. In May, rice prices had more than doubled year on year, marking the commodity’s highest price growth in over 50 years.<\/a><\/p>\n A rate hike by the BOJ will likely rein in inflation, bringing it closer to the bank’s target. The BOJ, however, has to tread a fine line, as raising rates could crimp an already weak Japanese economy which contracted more than initially estimated in the third quarter. <\/p>\n Revised GDP numbers<\/a> for the third quarter showed that Japan’s economy shrank more than initially estimated, shrinking 0.6% quarter on quarter, and 2.3% on an annualized basis. <\/p>\n