Japan's Core CPI excludes fresh food prices (unlike the U.S. definition which excludes food and energy). This is the BOJ's preferred measure for gauging underlying inflation trends.

Japan's Unique Definition

Japan defines "Core CPI" as excluding fresh food only. "Core-Core CPI" excludes both fresh food and energy—closer to the U.S. Core CPI definition. Both measures are closely watched.

BOJ's 2% Target

The BOJ judges whether inflation is sustainably at 2% primarily through the Core CPI lens, combined with wage growth data. Achieving stable 2% Core CPI has been the prerequisite for monetary policy normalization.

Market Impact

Core CPI above 2% with wage growth supports the case for further BOJ rate hikes, which strengthens the yen and can trigger global bond market adjustments.