BOJ set to raise interest rate to 1.25% next week

JUST IN: Bank of Japan set to raise its policy interest rate to 1.25% next week, the highest level in about 31 years, a level last seen in April 1995.

Japan is about to have its highest interest rate since 1995. The Bank of Japan plans to lift its policy rate to 1.25 percent at next week's meeting, a level not seen in thirty one years.

This is the Bank of Japan we're talking about, the institution that spent decades practically paying people to borrow. Governor Kazuo Ueda has been hiking roughly every six months, and now he's moving just three months after June. That's a central banker who's seen something. Higher oil, a weak yen, and AI demand pushing prices past the two percent target if he sits still.

And there's pressure from an unusual direction. US Treasury Secretary Scott Bessent has been openly cheering for this hike to stop the yen sliding further. When Washington is begging Tokyo to raise rates, you know the world's turned upside down.

April 1995 was the last time money cost this much in Japan. Most of the traders reacting to this weren't born yet.

This is Angel Manalo, reporting for HIT.