Bank of Japan eyes 0.25% rate rise toward 1% target

The Bank of Japan is reported to be discussing a 0.25 percentage‑point increase in its policy rate at the June meeting, with the possibility of additional hikes through 2026. The central bank is aiming for a longer‑run target around 1%, citing persistently low real interest rates and upward inflation risks. The move signals a further step in normalising Japan’s monetary policy after years of ultra‑loose stimulus, and could raise corporate financing costs, affect currency‑related risks and alter project planning for businesses.

Analysts note that the decision would align Japan’s policy stance more closely with other major central banks, influencing global capital flows and market expectations.