June 28 (Reuters) - A look at the day ahead in Asian

markets.

A mood of caution hangs over Asian markets on Friday, the

last trading day of the quarter and half-way point in the year,

with investors likely to keep risk exposure to a minimum ahead

of U.S. inflation data later in the day and ahead of the

weekend.

That wariness may be enforced by headlines from the U.S.

presidential debate between Joe Biden and Donald Trump late on

Thursday, particularly on trade protectionism and tariffs on

imports from China.

Friday's Asian economic calendar is packed with top-tier

releases, including: Tokyo inflation, Japanese unemployment and

industrial production, South Korean industrial output and retail

sales, and trade and current account figures from Thailand.

Top among them is probably Tokyo inflation, which will give

an insight into wider price pressures in Japan and what the Bank

of Japan might do at its July 30 to 31 policy meeting.

Pressure is mounting on the BOJ to raise rates again or taper

its bond purchases, if for no other reason than to cool some of

the selling pressure on the yen and lift the currency from the

38-year low it hit against the dollar this week.

Policymakers have warned that tightening policy too much could

harm consumer spending and economic growth. But they also

continue to express their displeasure with the yen's relentless

depreciation.

They can't have it both ways.

Japanese authorities have not yet intervened to support the yen

this time around, but traders will be on high alert for action,

especially in the least liquid parts of the global trading day.

Economists polled by Reuters reckon core Tokyo inflation

edged up to 2.0% in June from 1.9% in May. Officials would

probably be comfortable with that, but so might yen bears, and

renewed selling is bound to sound the intervention alarm.

China's currency, meanwhile, also reaches the mid-year point

on the defensive, and on Thursday slipped to a new low for the

year. Chinese stocks are in a similar boat, hugely

underperforming their regional and global peers.

The wider mid-year report card in Asia is mixed. Japan's Nikkei

massively outperformed, in large part thanks to the weak yen,

Japanese bond yields have hit multi-year highs, but the specter

of deflation has pushed Chinese bond yields to historic lows.

Most currencies are down against the U.S. dollar although

nowhere near as much as the yen. The Indonesian rupiah is at

multi-year lows, while India's rupee is at a record low but

spared further weakness by official intervention.

A snapshot of M&A activity in the January-June period on

Thursday may be more revealing about investor sentiment across

the continent. LSEG data shows that the value of announced

transactions dropped 25% year-on-year to $317.5 billion, and M&A

fees fell to $1.5 billion.

Both are the lowest in 11 years.

Here are key developments that could provide more direction

to markets on Friday:

- Tokyo inflation (June)

- Japan unemployment (May)

- U.S. presidential debate