Japan's core inflation cooled to 3.3% in June, coming down from a 29-month high of 3.7% as rice inflation showed signs of easing. The figure — which strips out costs for fresh food — was in line with the 3.3% expected by economists polled by Reuters. Headline inflation in the country dropped to 3.3%, coming down from 3.5% in May.

Japan's trade deal with the U.S. has reduced uncertainty surrounding the economy, the central bank's deputy governor Shinichi Uchida said, signaling optimism that conditions for resuming interest rate hikes may start to fall in place.

Japan’s market is rallying, but bond markets are flashing warnings. With rising yields, political uncertainty, and fading trust, the current surge may not hold for long.

With stocks at records, Trump's trade deal with Japan is another bullish catalyst for investors as the market moves toward the August 1 tariff deadline.

Japan's core inflation slowed in June but stayed above the central bank's 2% target for well over three years, highlighting lingering price pressures that back market expectations for further interest rate rises.

The bruising electoral defeat suffered by Japanese Prime Minister Shigeru Ishiba’s ruling coalition has plunged the country into a state of political uncertainty, creating a significant new dilemma for the Bank of Japan (BOJ).

President Donald Trump announced what he called a “massive” trade deal with Japan on Tuesday night. Trump wrote in a post to Truth Social that the trade agreement the U.

The election Sunday is about inflation that has been running between 3.5 percent and 4 percent.

Japan’s inability to lift inflation is “one of the biggest unsolved challenges in the profession,” said Mark Gertler, a professor of economics at New York University who has studied the issue.

Japanese government bonds tumbled on Wednesday, sending benchmark yields to near 17-year highs, as traders priced in increased political risks and a hazy outlook for the central bank's policy normalisation path.