Foreign exchange market data from sources like Bloomberg or Reuters

Bank of Japan Raises Rate by 25 Basis Points to 0.5%, Maintaining Accommodative Stance

Jan 24, 2025, 02:53 AM

The Bank of Japan raised its benchmark interest rate by 25 basis points to 0.5% on Friday, bringing rates to their highest level since 2008. The decision, made with an 8-1 vote during the policy meeting, reflects the central bank's response to signs of underlying inflation approaching its 2% target and expectations of robust wage growth. Despite the rate hike, the Bank maintains an accommodative stance, noting that real interest rates remain deeply negative and supportive of economic activity. Governor Kazuo Ueda indicated that the Bank may continue to adjust monetary policy appropriately if economic conditions align with forecasts, signaling a potential shift in approach.