Additional monetary easing unlikely from Japan this year

Bank of Japan (BoJ) introduced a new measure of CPI, excluding fresh food and energy, in its July Monthly Report, on which they now focus to assess the core inflation dynamics without the energy component. Japan's Inflation data will be the focus of the week in Japan.

"August Nationwide Core CPI excluding fresh food is expected to drop by -0.2% y/y, the first negative reading since April 2013", says Barclays. 

Their new CPI in July accelerated to +0.9% y/y from the Jan-Feb bottom of +0.4%. 

"With BoJ focusing on this measure, the additional monetary easing is not expected this year. USD/JPY will likely remain under pressure, given the dovish FOMC last week but will also likely remain prone to fluctuations in global risk sentiments", added Barclays.