Japan raises interest rate to 31-year high of 1.25%

The Bank of Japan raised its main interest rate from 1% to 1.25%, the highest level since 1995, marking its sixth hike since rates stood at minus 0.1% in 2024. The move follows similar tightening by the US Federal Reserve and the European Central Bank as energy prices tied to the Iran war push up global inflation, while Japan also contends with a weak yen and a shrinking workforce.