Japan hikes interest rate to highest level since 1995
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The Japanese yen was the worst-performing major currency against the bruised U.S. dollar in 2025, even though the Bank of Japan was the only major central bank to raise interest rates. Further tightening will not guarantee the yen escapes the intervention "danger zone.
This is the highest policy rate by Japan since the mid-1990s, ending a long era in which it stood apart as the last major economy clinging to near-zero interest rates. Several Indian companies borrowed in Japanese yen to take advantage of this practice.
The Japanese government is planning to invest 1 trillion yen into AI development and implementation, Prime Minister Sanae Takaichi said during a meeting of the AI Strategic Headquarters, which she chairs,
USD/JPY rose after the BoJ’s 25bp rate hike, but focus now shifts to Ueda’s press conference, Fed rate-cut bets, and narrowing US-Japan yield spreads.
The Japanese Yen (JPY) remains on the back foot against its American counterpart for the second straight day and pushes the USD/JPY pair to the 156.00 neighborhood, or the top end of the weekly range,
Japan’s 10-year government bond yield rose to a multi-decade high as investors reacted to the central bank’s interest rate hike, while the yen weakened in choppy trading. Japanese stocks held gains.
The USD/JPY pair rose to a high of 156, up sharply from this week's low of 154.37. Here's why the Japanese yen dropped after the decision
Rising Japanese exports and a looming BoJ rate hike pressure USD/JPY, with softer US data and Fed cut bets strengthening the bearish outlook.
Markets expect the Bank of Japan to raise interest rates by 25 basis points to 0.75% in Tokyo on Friday. That will take Japan's official borrowing costs to a 30-year high while the Federal Reserve is expected to continue trimming rates in the U.
The dollar lost ground against the Japanese yen and Swiss franc on Thursday after data showed a lower-than-expected rise in U.S. inflation, while the euro eased after the European Central Bank held interest rates steady.