BOJ Rate Hike Signals Faster Pace of Tightening Amid Inflation Risks

The Bank of Japan (BOJ) raised its interest rate by 25 basis points to 1.25 per cent, marking another step towards normalizing monetary policy.

This move comes as inflation risks and a weak yen are increasingly concerning policymakers.

JAPAN AND US BOTH MOVE AGAINST INFLATION

Economists say the BOJ's decision signals a faster pace of tightening, with some expecting further rate hikes in December and April.

Norihiro Yamaguchi, lead economist at Oxford Economics, expects further rate hikes in December and April, which would take the policy rate to 1.75 per cent.

The BOJ's decision also comes after the US Federal Reserve raised interest rates for the first time since 2023, indicating another increase could come before the end of the year.