16.06.2026, 13:03
The Bank of Japan raised its key interest rate to its highest level since 1995
Source: OREANDA-NEWS
OREANDA-NEWS The Bank of Japan raised its key rate from 0.75 to 1 percent per annum, which was the highest since September 1995. The regulator made the decision in the absence of its head, Kazuo Ueda, who was hospitalized due to liver problems and outlined his position on monetary policy in writing. This is reported by Reuters.
The Central Bank indicated that, given inflationary pressures, it would continue to raise the rate and adjust the PREP in response to changes in economic activity and prices.
The rate was raised to 0.75 percent, which was also the highest level since the mid-90s of the last century, in December 2025. Then the members of the Board of Governors made the decision unanimously, noting that "further increases are planned, if conditions permit."
The monetary authorities have been struggling with low inflation in Japan for years, and in early 2024, after the consumer price index excluding energy and food products rose above two percent in the country, they raised the rate for the first time in 17 years, taking it out of negative levels.
Against the background of the situation in the Middle East in the spring of this year, the country experienced a surge in wholesale inflation, which led economists to talk about fears of stagflation, and the authorities had to save the national currency, whose exchange rate rushed to 160 yen per dollar.
The markets reacted positively to the Bank of Japan's rate decision on June 16. The Nikkei 225 index has updated its historical record for the second day in a row, rising above 70 thousand points for the first time.
The Central Bank indicated that, given inflationary pressures, it would continue to raise the rate and adjust the PREP in response to changes in economic activity and prices.
The rate was raised to 0.75 percent, which was also the highest level since the mid-90s of the last century, in December 2025. Then the members of the Board of Governors made the decision unanimously, noting that "further increases are planned, if conditions permit."
The monetary authorities have been struggling with low inflation in Japan for years, and in early 2024, after the consumer price index excluding energy and food products rose above two percent in the country, they raised the rate for the first time in 17 years, taking it out of negative levels.
Against the background of the situation in the Middle East in the spring of this year, the country experienced a surge in wholesale inflation, which led economists to talk about fears of stagflation, and the authorities had to save the national currency, whose exchange rate rushed to 160 yen per dollar.
The markets reacted positively to the Bank of Japan's rate decision on June 16. The Nikkei 225 index has updated its historical record for the second day in a row, rising above 70 thousand points for the first time.
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