East Asia Econ

Korea – inflation still stable

The BOK hasn't sounded concerned about inflation for a while, and the July CPI data is unlikely to change that, with headline and core remaining close to 2%. Food prices will rise in August following the recent bad weather, but energy prices should fall. Core is also now starting to look softer.

Paul Cavey

Aug 5, 2025 • 2 min read

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China – a weak nominal upturn

While the PMIs don't point to any real improvement, in nominal terms there's been a lift, with input prices above 50 again. That's in line with the credit impulse. But the credit impulse might already have turned, and while PPI deflation has lessened, output prices don't suggest stronger CPI.

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East Asia Today

It's been a big week for data in Korea, and there was more today, with the end-month activity numbers. Retail sales bounced, but other sectors remained subdued. Data for Japan today showed retail sales being weak, but consumer confidence has improved, and UE has fallen to a new post-covid low.

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Japan – UE falls to post-covid low

The fall in the UE rate in July to 2.3% isn't substantively important. The mechanics behind it were more noteworthy, in particular a ticking down in the part rate. Other data today show a softening of inflation in Tokyo in August, and nationwide retail sales falling to the lowest level in 2 years.