Japan Inflation Eases, But BOJ Still Faces Policy Challenges
Wall Street JournalFriday, July 18, 2025 at 3:26:00 AM
Japan’s inflation rate dipped slightly, giving the Bank of Japan (BOJ) a bit of breathing room. But don’t break out the champagne just yet—food prices are still climbing, and that’s keeping policymakers on edge. It’s a mixed bag: some relief on the horizon, but not enough to call off the fight against rising costs.
Editor’s Note: Inflation cooling down sounds like good news, right? Well, sort of. While the overall trend is easing, everyday essentials like groceries are still pinching wallets, which means the BOJ isn’t out of the woods. This story matters because Japan’s economy has been stuck in a low-inflation rut for years, and now that prices are finally moving, getting the balance right is tricky. Too much tightening could stall growth, but ignoring stubborn food inflation risks leaving households squeezed. It’s a high-stakes tightrope walk.
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