BOJ Hikes Interest Rate to 1.25% Amid Inflation Fears

The Bank of Japan has raised its benchmark interest rate to 1.25%, its highest level since 1995, as it accelerates its departure from the zero-interest-rate era.

The decision, announced on September 18, marks a significant shift in monetary policy and comes just three months after the previous rate hike in June.

The move was made despite opposition from two members of the Policy Board, Toichiro Asada and Ayano Sato, who voted against the hike and called for rates to remain unchanged.

The BOJ's decision is aimed at containing inflationary risks, particularly rising import prices due to higher crude oil prices and a weaker yen.