17:01 - 16.06.2026
June 16, Fineko/abc.az. The Bank of Japan (BOJ) on Tuesday raised its key interest rate to 1%, which coincided with analysts' forecasts and accelerated the process of normalizing monetary policy, which began in 2024.
ABC.AZ reports that achievement of the 1% rate was recorded in the country for the first time since 1995.
Key factors and market reaction:
Reasons for the decision: The regulator's move is due to the fight against a weak yen and rising inflation, which is being pushed up by rising energy prices caused, among other things, by the war in Iran.
Market reaction: After the verdict was announced, index Nikkei 225 rose by 0.46%, the yen strengthened to 160.22 per dollar, and the yield on 10-year government bonds rose to 2.615%.
Reduction of bond repurchases in dollar terms: The central bank will continue to reduce government bond repurchases by 200 billion yens (approx. $1.25 bn) each quarter. After completion of the reduction program, from April 2027, the monthly volume of repurchases will be fixed at 2 trillion yens (nearly $12.48 bn).
