The Bank of Japan (BOJ) on Tuesday raised its benchmark interest rate by 25 basis points to 1.0 per cent, the highest level since 1995, as it seeks to curb inflationary pressures linked to rising energy costs.
The move marks the central bank’s first rate hike since December and comes despite a recent US-Iran peace agreement aimed at easing tensions in the Middle East.
The BOJ warned that higher crude oil prices could continue pushing up consumer prices and signalled that further rate increases remain possible if inflation risks persist.
Following the announcement, the yen strengthened briefly while Japan’s Nikkei 225 stock index reached a record high above 70,000 points.
