The BoJ raises rates to their highest level in 17 years – 01/24/2025 at 05:02

(Updated with details)

The Bank of Japan (BoJ) raised interest rates on Friday, a widely expected move that reflects its growing optimism about wage developments and its ability to keep inflation around its 2% target.

This is the first time that the Japanese central bank has decided to raise its rates since July 2024.

At the end of the meeting of its monetary policy committee, the BoJ decided to raise its short-term rate target to 0.5%, its highest level in 17 years.

“The probability of seeing the BoJ’s objectives being achieved has increased” while many companies have said they will continue to increase wages this year, the institution said in a press release.

This decision underlines the desire of the Japanese central bank to regularly raise its interest rates to around 1%.

A conference by BoJ Governor Kazuo Ueda is scheduled for 3:30 p.m. (06:30 GMT).

(Leika Kihara, Makiko Yamazaki, Kantaro Komiya and Satoshi Sugiyama; French version by Camille Raynaud)