The Bank of Japan (BOJ) raised its benchmark interest rate by 25 basis points to 1.25% during a two-day meeting on September 17–18, bringing Japanese borrowing costs to their highest level since 1995. The BOJ board voted 7–2 on the decision, with two board members opposing the hike.
The rate increase marks the second hike in three months as the central bank works to manage inflation near its 2% target. Japan's core consumer inflation rose 1.7% year over year in August, while energy costs and a weaker yen continue to pressure prices.
Despite the tighter monetary policy, the cryptocurrency market showed resilience. Bitcoin remained above $77,000, with the global crypto market cap standing around $2.73 trillion. Bitcoin recorded approximately $159 million in ETF inflows on September 17, providing support ahead of the BOJ decision.
The yen weakened following the announcement, falling as much as 0.8% to 157.145 against the dollar. Markets reacted calmly overall, and the move did not trigger major selling in global assets linked to yen carry trades. The BOJ's decision came shortly after the Federal Reserve raised its benchmark rate by 25 basis points to 3.75%–4.00% and followed recent rate increases by the European Central Bank.
