Inflation in Tokyo weakens expectations for BoJ rate hikes
On Friday, September 27, inflation data for Tokyo impacted investor bets on a Bank of Japan (BoJ) rate hike in the fourth quarter of 2024. Tokyo’s consumer price index, excluding food and energy, rose 1.2 in September % annualized, mirroring the August figure. Significantly, underlying inflation remained well below the BoJ’s 2% target, reducing expectations of a rate hike in the fourth quarter of 2024.
Falling bets on a BoJ rate hike boosted demand for USD/JPY. The USD/JPY rose 0.21% to 145.107 on Friday morning, increasing buyer interest in Nikkei-listed stocks.
Investors ignore weak Chinese industrial profits
Chinese industrial profits are up 0.5% this year. Industrial profits fell significantly from 3.6% in July. However, investors ignored the figures as the People’s Bank of China and the Politburo introduced policies to strengthen the economy.
On Friday, the People’s Bank of China cut the 14-day reverse repo rate to 1.65% from 1.85%, signaling further policy support for Chinese banks.
Bloomberg TV Asia Pacific Chief Markets Editor David Ingles commented on stock markets in mainland China: to report,