Japan July Core CPI Up 1.8% YoY, BOJ Hike Largely Priced for September

English summary

Japan's July core CPI rose 1.8% YoY, in line with expectations, while core-core CPI rose to 1.9% and services inflation increased modestly, suggesting firms are passing on labor costs. Wholesale inflation hit 7.2%, indicating sustained upstream pressure. With a weak yen and higher energy prices, BOJ hike to 1.25% in September is largely priced in.