Japan Shocks Markets: BoJ Raises Rates to a 30-Year High
Japan Shocks Markets: BoJ Raises Rates to a 30-Year High
Japan’s era of ultra-low interest rates is officially fading.
The Bank of Japan (BoJ) has raised its key policy rate to the highest level in three decades, signaling a major shift in the country’s monetary stance as inflation pressures squeeze households.
In a widely anticipated move, the BoJ’s policy board, led by Governor Kazuo Ueda, increased the benchmark interest rate by 25 basis points, taking it to around 0.75% on Friday.
Why This Matters
For years, Japan stood apart from global central banks by maintaining near-zero rates. This decision reflects growing concern over:
Rising cost-of-living pressures
Persistent inflation trends
The need to normalize long-standing accommodative policy
The hike marks another step away from Japan’s historic easy-money framework, which had defined its economy for decades.
Big market moves always begin with macro shifts.
• BOJ tightening → Yen strength
Carry trades start reversing
Liquidity dries up
Emotional traders panic
Smart traders adjust and stay ahead
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