Tokyo inflation fell to 1.8 percent in February, the lowest level in more than a year, largely due to energy subsidies from the government of Sanae Takaichi. Despite this decline, core inflation excluding energy rose to 2.5 percent and remained above the 2 percent target, indicating that underlying price pressures persist. This situation has complicated policy communication for the Bank of Japan because signs of cooling inflation are appearing alongside continued underlying momentum. Markets still raise the possibility of rate hikes in the coming months, although the central bank is likely to act cautiously while assessing policy effects.

JPMorgan predicted that if the new US crypto market structure legislation is approved by mid year, the crypto market could strengthen in the second half of 2026. The plan seeks to create a transparent regulatory framework for digital assets, but it is moving slowly in the Senate due to disagreements. One of the main challenges is whether platforms such as Coinbase Global Inc. should be allowed to pay yields to stablecoin holders, something banks view as a risk to financial stability. Matt Hougan says crypto downturns usually end gradually and with volatility, and a rapid price rebound appears unlikely.