Japan Awaits Upper House Election Outcome, Consumer Price Inflation Slows to 7-Month Low

Akira Ito
18 Jul, 2025
Tokyo

Stocks struggled in Tokyo ahead of the Upper House election this weekend, and investors reviewed the latest inflation report. 

The Nikkei 225 Stock Average fell 0.1%, and the broader Topix declined 0.1% amid political uncertainty and fiscal spending worries. 

The yen rebounded from the previous session but hovered near a three-year low of 148.17 against the U.S. dollar.

On the economic front, overall consumer price inflation in June eased to a seven-month low, and core inflation dropped to a three-month low. 

Consumer price inflation slowed to 3.3% from 3.5% in May, marking the lowest level since last November, according to the data released by the Ministry of Internal Affairs & Communications. 

The overall inflation cooled, but the food price inflation rebounded to 7.2% from the 6.6% level in the previous two months, and electricity prices rose at a softer pace of 5.5% compared to 11.3% in the previous month. 

Core inflation, which excludes food prices but includes energy prices, matched the overall inflation rate of 3.3%, following a 3.7% increase in the previous month.

 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average inched lower 0.11% to 39,857.38, and the broader Topix decreased 0.1% to 2,836.96. 

The market gains were capped by rising trade risks, as Japan has yet to finalize its trade agreement with the U.S. ahead of the U.S.-imposed deadline of August 1. 

Toyota Motor Corp. decreased 0.4% to ¥2,511.0, Honda Motor Co. Ltd. fell 0.03%, and Nissan Motor Co. Ltd. eased 1% to ¥306.30. 

Seven & I Holdings Co. Ltd. fell 3.5% to ¥1,935.50, Takashimaya Co. Ltd. edged up 1.1% to ¥1,140.50, Aeon Co. Ltd. gained 1.8% to ¥4,682.0, Isetan Mitsukoshi Holdings Ltd. jumped 0.5% to ¥2,187.0, and Fast Retailing Co. Ltd. inched higher 0.1% to ¥44,560.0.