Asian Stocks Mixed as Nikkei Advances: Japan Inflation Remains Below BoJ’s 2% Target, Sparking Policy Uncertainty

Asian markets traded unevenly as Japan’s Nikkei 225 rose 0.8% to 38,450.67 after data showed core CPI at 1.8% YoY in January—still below the BoJ’s 2% target. The weak inflation print reinforces the Bank of Japan’s ultra-accommodative stance (-0.1% short-term rate, 10-year yield cap) and sustains policy uncertainty about the timing of normalization, supporting Japanese equities via low borrowing costs and carry trades. Other Asian markets were mixed — Hong Kong and South Korea weakened while Australia gained — highlighting regional divergence tied to local demand, commodity prices and currency moves (yen near 150/USD). Investors are watching CPI releases, wage talks and BoJ signals for shifts that could reverse capital flows.