Bank of Japan says inflation hit 2% target after 13 years

The Bank of Japan announced on Friday that inflation had reached its 2% target, a goal pursued for over a decade to combat deflation and stimulate economic growth. Deflation, characterized by sustained price declines, has long perplexed successive governments and the Bank of Japan, which introduced aggressive monetary easing measures in 2013 to combat the issue.

While core consumer inflation occasionally exceeded the 2% mark in the early 2020s, the BoJ confirmed on Friday that the long-term price trend had indeed been achieved. On its website, the central bank reported that underlying CPI inflation is generally consistent with the 2% price stability target and is expected to remain at around that level.

Additionally, the BoJ stated that it maintained its key interest rate at 1.25% following an eight-to-one majority vote. This decision followed a similar move by the US Federal Reserve and the European Central Bank earlier in the week to keep their policy rates unchanged. Nevertheless, Japanese officials anticipate a rate hike in December as inflationary pressures continue to mount.

In September, Japan's core inflation rose to 2.1%, a significant increase from 1.7% in August, according to government data released earlier this week.