Japan Indexes Trimmed Weekly Losses, Inflation Accelerated to a 2-Year High in January

Akira Ito
21 Feb, 2025
Tokyo

Stock market indexes in Tokyo advanced on Friday and trimmed weekly losses, and investors reviewed the latest updates on inflation and manufacturing activities. 

The Nikkei 225 stock average edged up 0.3%, and the broader TOPIX inched higher by 0.1% after the annual inflation accelerated in January and rose at the fastest pace since January 2023. 

The annual consumer price inflation accelerated to 4.0% in January from 3.6% in the previous month, the Ministry of Internal Affairs and Communications said on Friday. 

The food price inflation advanced to a 15-month high of 7.8%, and electricity costs stayed elevated at 18.0% with the removal of energy subsidies since May 2024.

The core rate of inflation increased to a 19-month high of 3.2% from 3.0% in December. 

The monthly core inflation rate slowed to 0.5% from a 14-month high of 0.6% in December.

The au Jibun Bank Japan Manufacturing PMI edged up slightly in January, according to an update released by S&P Global on Friday. 

The manufacturing index inched up to 48.9 in February from a 10-month low of 48.7 in the previous month. 

The index of manufacturing activities contracted for the eighth month in a row as both output and new orders growth continued to shrink. 

In addition, the report showed that business sentiment deteriorated to the lowest level since June 2020.

The Japanese yen edged higher to 150.45 against the U.S. dollar after the release of inflation data, supporting the case for the Bank of Japan to raise interest rates at the next meeting in March. 

 

Japan Indexes and Stocks

The Nikkei 225 Stock Average increased 0.3% to 38,776.94, and the TOPIX added 0.1% to 2,736.53. 

DeNA Company soared 14.5% to ¥4,025.0 and rose to a five-year high amid enthusiasm about its mobile version of the popular Pokemon Trading Card Game. 

Mercari Inc. gained 2% to ¥2,299.50 amid a surge in tech and internet stocks for the second consecutive session. 

Suzuki Motor Corp. decreased 3.2% to ¥1,880.0, and the company's India unit continues to lose market share to domestic competitors. 

IHI Corp. dropped 3.8% to ¥9,150.0, and Kawasaki Heavy Industries decreased 2.3% to ¥7,862.0.