Japan's core inflation 1.4% hits 4 year low, testing BOJ
Japan's core inflation just hit its lowest point in four years, which puts the Bank of Japan (BOJ) in a tricky spot as it decides whether to raise interest rates.
The core consumer price index (CPI) rose only 1.4% in April 2026, much less than economists expected, making it harder for the BOJ to figure out its next move.
Businesses still passing costs, BOJ cautious
This slowdown is mainly because prices for processed food and durable goods aren't rising as fast, plus there's been a big drop in private high school fees.
Energy costs have also cooled off a bit.
Even with these changes, businesses are still passing higher labor and material costs onto shoppers, so BOJ officials are staying cautious.
Meanwhile, Sanae Takaichi wants to bring back energy subsidies to help keep prices steady, but with the weak yen making imports pricier, it's anyone's guess when the BOJ will finally hike rates.