Central Banks
Japan Hikes Rates, Solidifying Exit From Rock-Bottom Borrowing Costs
- Yen strengthens as higher inflation view suggests more hikes
- Decision widely expected by markets following clear hints
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The Bank of Japan raised its key policy rate Friday to the highest level since 2008 and took a more bullish view on the strength of inflation, fueling expectations for more rate hikes and supporting the yen.
Governor Kazuo Ueda and his fellow board members lifted the overnight call rate by a quarter-percentage point to 0.5% at the end of a two-day meeting, according to a statement from the central bank. A hike was almost fully priced into market expectations ahead of the announcement.