Asia-Pacific: Japan inflation and S. Korea rate decision in focus
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Japan – Inflation and Interest Rates:
Tokyo consumer price inflation (Friday) will be closely watched as a leading indicator of nationwide inflation trends. Markets expect a 2.3% YoY increase, keeping inflation above the Bank of Japan’s 2% target. If inflation accelerates, speculation around a BOJ rate hike later in 2025 could intensify.
Industrial Production & Retail Sales (Friday):
Recent data showed a rebound in industrial output, but further evidence is needed to confirm a sustained recovery. These indicators will influence BOJ’s rate decision expectations.
South Korea – Rate Decision (Tuesday):
The Bank of Korea is expected to cut interest rates by 25bps to 2.75% to counteract slowing growth. U.S. trade tensions and tariffs remain a downside risk, impacting exports.
China – PMI Data (Saturday, March 1):
Weak January manufacturing data raised concerns over economic momentum. The February PMI release will indicate whether post-Lunar New Year activity rebounded. Any stimulus hints from Beijing ahead of the Two Sessions political meetings in March will also be closely monitored.
Bond Market Activity:
Japan: 2.6T yen auction of 2-year JGBs (Thursday).
Bank of Japan’s outright bond purchases (Wednesday) could provide liquidity.
South Korea: Interest rate decision may impact government bond yields.
Tokyo consumer price inflation (Friday) will be closely watched as a leading indicator of nationwide inflation trends. Markets expect a 2.3% YoY increase, keeping inflation above the Bank of Japan’s 2% target. If inflation accelerates, speculation around a BOJ rate hike later in 2025 could intensify.
Industrial Production & Retail Sales (Friday):
Recent data showed a rebound in industrial output, but further evidence is needed to confirm a sustained recovery. These indicators will influence BOJ’s rate decision expectations.
South Korea – Rate Decision (Tuesday):
The Bank of Korea is expected to cut interest rates by 25bps to 2.75% to counteract slowing growth. U.S. trade tensions and tariffs remain a downside risk, impacting exports.
China – PMI Data (Saturday, March 1):
Weak January manufacturing data raised concerns over economic momentum. The February PMI release will indicate whether post-Lunar New Year activity rebounded. Any stimulus hints from Beijing ahead of the Two Sessions political meetings in March will also be closely monitored.
Bond Market Activity:
Japan: 2.6T yen auction of 2-year JGBs (Thursday).
Bank of Japan’s outright bond purchases (Wednesday) could provide liquidity.
South Korea: Interest rate decision may impact government bond yields.