Bank of America analysts say Japanese inflation is set to reaccelerate, but the country's central bank still has reasons to hold off on raising interest rates. The call matters for global bond and currency markets that have been whipsawed by Japanese policy expectations.
Cleveland Fed President Beth Hammack says policy may need to tighten further to bring inflation back to 2%, warning that businesses are increasingly passing costs to consumers. She favors small, frequent rate moves over abrupt shifts.
New bankruptcy data from Tokyo Shokō Research shows 5,373 Japanese firms with debts over 10 million yen failed in the first half of fiscal 2026, a 13-year record. Rising interest rates and shrinking demand are hitting the smallest companies hardest.
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