The dip in consumption that began in August is continuing. By contrast, wage growth isn't slowing, and while for full-time workers has only just caught up with inflation, for part-time workers it is comfortably ahead. This should be setting up better consumption, and so aggregate demand, in 2025.

Profits ticked down in Q3, but that was after a strong Q3, and there's no change in the uptrend in earnings, margins or capex. In this context of continued strong profitability, the mild rise in the labour share is also constructive. However, trends in smaller firms are much weaker.

Today's data releases show the labour market remaining tight and consumers continuing to feel more confident than might be expected given price rises. Inflation continues to run at around 2%, and with rentals rising, inflation should have a higher floor from here.

Today's flash PMI was weak, but respondents highlighted JPY-driven price pressures. October CPI data were also firm. Ueda highlighted this week that December is live, but dependent on data before then. The BOJ's assessment of services inflation, and the Q4 Tankan, are particularly important.

Governor Ueda today struck a positive tone on domestic developments. But he also highlighted overseas uncertainties, and didn't give any hint of a hike in December. That doesn't make next month impossible, but it is more difficult.

GDP grew again in Q3. Much of the rise since Q2 is because of a recovery in consumption, but that continues to be much more visible in per capita terms: aggregate consumption is still below the pre-2020 highs, dragged down by a fall in the population, a decline that the BOJ obviously can't address.

The opinions from the October BOJ meeting show a bit less concern about US uncertainty. That seems premature, given the election, but comments on the domestic economy also don't suggest any change in the bank's fundamental view. Survey data have been a bit softer, but not yet uniformly.

The boxes in the BOJ's full outlook report that look at the labour market and wages don't suggest any weakening of the bank's underlying confidence – increasingly evident before July – that Japan's inflation is sustainable. The implication is that rate hikes remain on the agenda.

No surprises from the BOJ (yet): the July forecast for underlying inflation to remain around 2% was maintained, as was the policy caution since August that stresses uncertainty in outlook for the US. There's still the press conference and full outlook report to come.