ING: Inflation may reshape the Bank of Japan's interest rate hike plans

According to ME News, Japan's CPI data will be released on January 22 (UTC+8) ahead of Friday's interest rate decision. The data is expected to show a significant drop in December's inflation rate. Analysts at ING stated that a decline in inflation could prompt the Bank of Japan to reconsider its future interest rate hike plans. "Strong wage growth and government aid measures will keep core inflation above 2%. Once the Bank of Japan confirms that core inflation will continue to be above 2% and higher than overall inflation, it is likely to take further action sometime in the second half of 2026." (Source: ME)