BOJ Raises Interest Rates to 31-Year High Amid Global Inflation Pressures

The Bank of Japan (BOJ) raised its interest rates to a 31-year high on September 18, signaling a shift in policy focus. The move follows rate hikes by European and US peers, highlighting central banks' focus on global inflation risks.

The BOJ raised its policy rate to 1.25 per cent from 1 per cent by a 7-2 vote. Dovish board members Toichiro Asada and Ayano Sato dissented to the decision.

BOJ Governor Kazuo Ueda said underlying inflation is approaching 2 per cent, and if it overshoots, it could have a negative impact on Japan's economy. The BOJ's policy focus has shifted to stabilizing underlying inflation at 2 per cent.