[Fitch: Inflation is deeply entrenched, Bank of Japan expected to raise rates by 75 basis points to 1.5% this year] Jin10 Data, April 28 – Japan has overcome the nominal growth stagnation and deflation that plagued its economy for over two decades. Fitch Ratings stated that inflation is now deeply entrenched and increasingly driven by domestic factors, supporting Fitch's view that the Bank of Japan will continue to advance monetary policy normalization. Since 2022, overall consumer price inflation has averaged 2.9%, exceeding the Bank of Japan's 2% target. The recent decline in overall inflation mainly reflects government energy measures rather than a weakening of underlying price pressures. Fitch expects the Bank of Japan to continue raising rates, with the policy rate increasing by 75 basis points to 1.5% by 2026. The real policy rate remains deeply negative and is expected to normalize as the Bank of Japan further tightens policy, which in turn should exert some upward pressure on the yen.