USD/JPY: Dollar Climbs Above ¥159.00 as Japan Inflation Soars, New Metric Shows

USDJPY −0.05% Key points: Dollar-yen pair tops ¥159.10 Japan inflation passes 2% Interest rates could rise Bank of Japan has a new metric to measure inflation. And it just popped way above the 2% target. 💴 Yen Slides as Inflation Jumps The USD/JPY pair climbed 0.3% Tuesday, pushing back above the closely watched ¥159.00 level as traders weighed hotter inflation data against expectations for another Bank of Japan rate hike. Apparently, stronger inflation still wasn’t enough to scare away dollar bulls. Japan’s new core inflation gauge accelerated to 2.8% in April from 2.5% in March, blowing past the BoJ’s 2% target. Unlike the standard CPI reading, this measure strips out government subsidies and one-off distortions to better capture “real” price pressure. That’s a big gap from the government’s official core CPI figure of 1.4% released last week. In simple terms: inflation in Japan may be running hotter under the hood than headline data initially suggested.