Yen Firms as Japan September Core CPI Reaches 2.1% Above Bank Target

The Japanese yen firmed, holding USD/JPY within a 157 to 159 range after Japan's consumer price data supported expectations for Bank of Japan policy normalization. In September, headline CPI rose 2.1% year-over-year, meeting expectations and up from 1.9% prior. Core CPI, excluding fresh food, climbed to 2.1% from 1.7%, topping the central bank's 2% target for the first time since December. Meanwhile, the core-core index advanced 2.4%, surpassing the 2.3% forecast and accelerating from 1.9%. While the BoJ is expected to hold rates at 1.25% in October, the figures reinforced bets on a December rate hike.