Japan Hikes Interest Rates to 31-Year High Amid Inflation Fears

The Bank of Japan (BoJ) raised interest rates to their highest level in over three decades, hiking them by 25 basis points to 1.25 percent.

This move was widely expected following recent tightening by the European Central Bank and the US Federal Reserve, but it wasn't unanimous as it passed with a 7-2 majority vote.

The decision comes amid growing pressure on the BoJ to further tighten monetary policy due to surging energy prices and a weak yen, which is driving up the cost of imported goods and putting upward pressure on inflation.

Core inflation, which excludes volatile fresh food prices, slowed slightly in August to 1.7 percent from 1.8 percent, but remains close to the BoJ's two percent target.