Japan’s inflation hit 3% for the first time in over three decades in September — excluding a tax hike-induced rise in 2014 — an acceleration that adds to doubts over the need for continued central bank stimulus.
The year-on-year rise in September’s consumer prices excluding fresh food matched analysts’ forecast. The inflation reading was the highest since 1991 outside a jump in 2014 when prices were impacted by an increase in the sales tax.
The price acceleration comes as global funds appear to have stepped up their bets against Bank of Japan policy once more. Ten-year swap rates are at a level that signal at least some traders are betting the central bank will be forced to capitulate on their policy of capping 10-year yields to help boost the economy.