Softer January Tokyo inflation data eases pressure on the BoJ to hike rates again soon, despite a still-tight labour market. Headline Tokyo CPI slowed to 1.5% year-on-year in January, down from 2.0% in December. Tokyo inflation data is seen as a leading indicator for nationwide CPI trends, and the January figures suggest that the recent inflation pulse may be losing some traction. While the central bank retained a hawkish tone in its latest communications and stressed vigilance toward inflation risks linked to a weak yen, the softer Tokyo readings reduce the urgency for immediate follow-up tightening. While further rate hikes remain on the table later in the year, January’s Tokyo CPI data suggests the BoJ can afford to move cautiously rather than act with urgency.