Yen Firms as Japan Underlying Inflation Hits 2.4%, Raising December BoJ Hike Odds

The Japanese yen firmed, keeping USD/JPY between 157 and 159, as official data showed Japan's underlying inflation surged to 2.4% year-over-year in September from 1.9% in August, topping estimates. Headline consumer inflation rose to 2.1% from 1.9%, while core CPI excluding fresh food climbed to 2.1% from 1.7%, moving above the Bank of Japan's 2.0% target for the first time in nine months. The broadening price gains across goods and services have bolstered market expectations for the central bank to hold rates at 1.25% in October before raising them to 1.50% in December.