BOJ Raises Policy Rate to 1% for First Time in 31 Years

Jun 16, 2026 | News On Japan

TOKYO - The Bank of Japan decided at its monetary policy meeting on June 16th to raise its policy interest rate for the first time in four meetings, lifting the benchmark rate from around 0.75% to around 1.0%, the highest level in 31 years.

The decision was approved by a majority vote at the meeting, which concluded earlier in the day. The central bank cited the risk that prices could rise more than expected due to higher crude oil prices as a key reason for the rate increase.

A policy rate of 1.0% marks the highest level since 1995, returning Japanese interest rates to a level not seen in more than three decades.

The BOJ also decided to halt its ongoing reductions in government bond purchases after April next year, ending a process that had been gradually scaling back the central bank's bond-buying operations.

Deputy Governor Shinichi Uchida is scheduled to hold a news conference at 3:30 p.m. to explain the background behind the rate hike and other policy decisions. He will appear in place of Governor Kazuo Ueda, who is currently hospitalized.

Source: TBS

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