Bank of Japan Hikes Rate to 1.25% Amid Split Vote

The Bank of Japan raised its key interest rate to 1.25%, the highest level in 31 years, but a split vote on the board left investors uncertain about future moves.

The decision was approved by a 7-2 majority, with two board members opposing further borrowing cost increases.

The move marked another step away from Japan's multiyear policy of ultra-low interest rates, which helped establish the yen as a cheap funding currency for global markets.