Japan’s core consumer inflation slowed to 2.7% y/y in August, matching forecasts and easing from 3.1% in July, though still above the Bank of Japan’s 2% target. An index that strips out both fresh food and fuel — closely watched as a gauge of underlying inflation — rose 3.3% y/y, down slightly from 3.4% in July.The data provide some relief for households but remain strong enough to keep the BoJ cautious. Policymakers conclude their two-day meeting on Friday and are widely expected to leave rates at 0.5%. Governor Kazuo Ueda has stressed the need for patience given uncertainty over the impact of U.S. tariffs on Japan’s economy. The BoJ expects near-term price pressures from food and imports to fade, with wage growth and consumption gradually supporting more durable inflation. Still to come today, the Bank of Japan:Preview - BoJ seen keeping rates at 0.5% as tariffs, U.S. slowdown weigh on outlookMUFG expects Bank of Japan to hold off rate rise, sees next hike pushed to January 2026Bank of Japan meeting begins today, rates expected to kept on hold - Nikkei reportBOJ to hold key interest rate at 0.50% in September meeting - pollEconomic calendar in Asia 19 September 2025 - Japan inflation data, then Bank of Japan This article was written by Eamonn Sheridan at investinglive.com.