WEB DESK: The Bank of Japan on Wednesday raised rates and introduced a plan to reduce its purchases of Japanese government bonds by half in a move that was a surprise to the markets.
At its two-day policy meeting, the BOJ voted to increase its short-term policy rate target to 0.25% from a range of 0% to 0.1%. Most BOJ watchers had expected that the central bank would wait until September or October to tighten in order to gather more data.
The yen strengthened to the ¥152 level against the dollar ahead of the announcement, as local media reported the possibility of a rate increase. The Japanese currency has staged a dramatic comeback from the nearly ¥162 level in early July.
