Asia week ahead: Tokyo CPI and effects of easing geopolitical risks in focus

AI Summary

Japan's upcoming June consumer price index report is expected to show a modest headline inflation rise to 1.7% year-on-year. Government interventions such as gasoline price caps and utility subsidies aim to keep inflation below 2%, despite currency weakness and impacts from high energy prices.

Japan: Government measures keep inflation below 2% Tokyo’s June consumer price index is the key release next week. We expect headline inflation to rise modestly to 1.7% year-on-year. The government’s price cap on gasoline and renewed utility subsidies should keep inflation below 2%. Yet, JPY weakness and second-round effects from higher energy prices should add ...