Japanese inflation rose slightly in August, with prices up 2.8 percent year-on-year, official data showed Friday, hours before the Bank of Japan was widely expected to leave interest rates unchanged.

Traders betting on further recovery in Japanese equities are looking to any steer from the Bank of Japan that may cap the yen’s gains and support exporters.

Japan's core consumer inflation accelerated for the fourth straight month in August and tracked comfortably above the central bank's 2% target, data showed on Friday, keeping alive expectations for further interest rate hikes.