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Bank of Japan Signals More Rate Hikes Ahead

12/29/2025

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Story summary
  • Bank of Japan (BOJ) policymakers said further rate hikes may be needed after lifting policy rate to 0.75%, the highest in 30 years.
  • Some members urged periodic increases, noting inflation has exceeded the 2% target for four years and weak yen.
  • They argued policy rate remains too low relative to inflation and stressed the need for flexibility.
  • Government representatives backed BOJ decisions but warned about corporate impacts from borrowing costs.