The Bank of Japan pushed interest rates to their highest level
The Bank of Japan on Friday raised its key policy interest rate to a 30-year high of around 0.75 percent, up from about 0.50 percent, as it seeks to contain persistent inflation driven by the weak yen.
The central bank’s first rate increase since January came amid expectations that the momentum for wage hikes will continue into next year. The rate decision was the first under the government of Prime Minister Sanae Takaichi.
At the end of its two-day meeting, all nine BOJ Policy Board members voted for the increase.
In a statement released after the meeting, the BOJ said the likelihood of realising its baseline inflation scenario has been rising — a prerequisite for further hikes.
Japan’s core consumer prices have remained at or above the central bank’s 2 percent inflation target for more than three and a half years.
The BOJ said it judged it “appropriate” to adjust the degree of monetary accommodation to achieve its inflation goal, adding that it will continue to raise its policy rate depending on economic and price developments as monetary conditions are still accommodative despite the latest interest rate increase.
