Japan's Producer Price Inflation Held Stable, Yen Weakened to 8-Month Low

Akira Ito
10 Oct, 2025
Tokyo

Japan's market indexes pulled back on Friday, and investors questioned the duration of the market rally since the April slump. 

The Nikkei 225 Stock Average decreased 1.2%, the broader Topix plunged 2%, and the yen eased to 152.80 against the dollar.  

Benchmark indexes closed down on Friday after a measure of wholesale price inflation rose in September, supporting the Bank of Japan's campaign to raise rates sooner rather than later. 

For the week, the Nikkei 225 Stock Average jumped more than 4%, and the Topix advanced more than 3% after the LDP's leadership results. 

The Japanese yen dropped to a multi-month low amid expectations of additional fiscal policy support from the new administration. 

The recently elected LDP's leader, and presumed prime minister, Sanae Takaichi is likely to support additional fiscal spending and pressure the Bank of Japan to continue its ultra-loose monetary policy. 

However, Takaichi may face hurdles in winning durable support from its junior partner, Komeito, as the LDP leader's comments rattled the party's core voter base. 

Takaichi's pressure on the Bank of Japan to maintain its ultra-loose policy may face resistance from policymakers amid rising prices and uncertain exports. 

Japan's producer price index in September held at 2.6%, matching August's rate, the Bank of Japan reported Friday.

The cost for intermediate products continued to rise, and the measure of wholesale inflation advanced 0.3%, reversing the 0.2% decline in August.

 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average decreased 1.2% to 47,980.62, and the broader Topix dropped 2% to 3,193.32. 

Semiconductor equipment makers turned lower in Tokyo, reflecting a decline in tech stocks in overnight trading in New York. 

Tokyo Electron decreased 1.4% to ¥29,295.0, Advantest Corp. fell 0.8% to ¥17,860.0, and Disco Corp. declined 0.7% to ¥53,380.0.