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Bank of Japan Raises Rate to 1.25% in September

By Drooid · Sep 12, 2026, 6:34 AM UTC · How we work

Summary

Bank of Japan Hikes

Bank of Japan will raise its policy interest rate by 0.25 percentage point to 1.25 % at its September 17-18 meeting.
The 1.25 % rate is the highest level since April 1995, 31 years after the last such rate.
Governor Kazuo Ueda said inflation risks have not yet required extraordinary action, so the hike stays at 25 basis points.
Board member Masu Kazuyuki said the bank will keep raising rates while underlying inflation approaches the 2 % target.

Summary

Takaichi Requests Budget

Prime Minister Sanae Takaichi requests a 143.1 trillion-yen budget, matching pandemic-era levels.
The expansionary agenda drives government borrowing costs to three-decade highs.
Nearly three-quarters of economists say the large budget raises market worries about fiscal discipline.
A planned consumption-tax cut on food items adds funding concerns for the fiscal year.
Analysts warn that unclear final budget size and new bond issuance could strain Japan’s financing outlook.

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Bank of Japan Hikes

Bank of Japan will raise its policy interest rate by 0.25 percentage point to 1.25 % at its September 17-18 meeting.
The 1.25 % rate is the highest level since April 1995, 31 years after the last such rate.
Governor Kazuo Ueda said inflation risks have not yet required extraordinary action, so the hike stays at 25 basis points.
Board member Masu Kazuyuki said the bank will keep raising rates while underlying inflation approaches the 2 % target.

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