Overview
- The Bank of Japan raised its short-term policy rate to 1.0% on Tuesday, the highest level since 1995, in a 7-1 vote to counter rising price pressures.
- Governor Kazuo Ueda was absent from the meeting for medical treatment so Deputy Governor Shinichi Uchida chaired the meeting and delivered the post-decision briefing.
- The BOJ said it will slow the pace of reductions in its Japanese government bond purchases, keeping quarterly cuts steady through March 2027 to protect market stability.
- Markets trimmed expectations for further tightening after a US‑Iran framework eased near-term oil-price risk, and the Reserve Bank of Australia held its cash rate at 4.35% on Tuesday.
- The move continues a multi-year unwind of ultra-loose policy driven by wholesale price spikes and a weak yen and is likely to keep import costs, mortgage rates and FX moves under close watch for consumers and businesses.