BOJ Rate Hike Leaves Yen on Edge

The Bank of Japan (BOJ) raised its policy rate by 25 basis points to 1.25%, its highest level in 31 years, as expected by markets.

While the BOJ signaled that it will continue to tighten policy further, there was no indication of a quicker pace than before. BOJ governor Ueda emphasized that the central bank will monitor economic and price developments closely.

The yen initially weakened after the rate hike, but later recovered some ground as USD/JPY tested the 158 level.

In other markets, oil prices eased back on reduced worries about Middle East supply disruptions, while bond yields remained elevated, keeping investors on edge.